08/08/2007 - 15:47

PCH rejects $230m Cape takeover bid

08/08/2007 - 15:47

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Malaga-based scaffolding and form-work supplier PCH Group Ltd has rejected an increased takeover bid from UK-based industrial services company Cape plc, saying the $1.30 per share offer was not high enough.

Malaga-based scaffolding and form-work supplier PCH Group Ltd has rejected an increased takeover bid from UK-based industrial services company Cape plc, saying the $1.30 per share offer was not high enough.

In an announcement to the ASX, PCH chairman Bill Ryan said that shareholders would be better off in the medium to long term holding on to their shares.

"Our business is performing well ahead of our already high expectations and we are confident that we will continue to enjoy significant growth in the years ahead."

PCH announced in June the two companies were talking again after it rejected a Cape bid of 90 cents per share in February, saying at the time the bid was undervalued and poorly timed, and baulked at disclosing information to a company which was its competitor in some markets.

In the past year, PCH stock has oscillated from 50.5 cents to $1.13. Stocks in the company closed down 3.67 per cent today, putting it at $1.05 per share.

 

 

The full text of a PCH announcement is pasted below

PCH Group Ltd has previously advised the market that it had been in discussions with Cape plc which may have led to a recommended takeover offer being made for all the shares in the Company.

As previously disclosed, Cape was provided with confidential non public information under the protection of a Confidentiality Agreement which contains a provision that prevents Cape, for a period of twelve months from the date of the agreement, from acquiring shares in PCH without the support of the PCH Board.

After completing further due diligence, Cape advised the Board of PCH that it was prepared to make an offer of $1.30 cash for each PCH share subject to a range of typical bid conditions(including, but not limited to, FIRB approval, 90% minimum acceptance and no material adverse change occurring in relation to PCH).

The Board of PCH met last night and has unanimously resolved not to support the proposed offer from Cape. The Board's decision is based on a unanimous view that the offer undervalues PCH shares bearing in mind its current operating performance and future growth prospects.

BR Bill Ryan, Chairman of PCH said "After giving careful consideration to this latest offer from Cape the Board came to the unanimous conclusion that our shareholders will be better off in the medium to long term holding their shares in PCH rather than accepting an offer of $1.30. Our business is performing well ahead of our already high expectations and we are confident that w will continue to enjoy significant growth in the years ahead.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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