Wesfarmers bids $21m for risk management firm

Diversified conglomerate Wesfarmers looks set to acquire risk management and compliance firm Greencap in an all-scrip takeover bid worth up to $21.2 million.

Greencap announced today it had signed an agreement to enter a scheme of arrangement, with Wesfarmers Industrial and Safety Pty Ltd proposing to pay 8 cents cash for each Greencap share.

The scheme has been unanimously supported by Greencap’s board of directors.

The company’s shares had gained 1.6 cents at 2:00PM, WST, trading at 7.6 cents.

Deloitte Corporate Finance will prepare an independent expert’s report on the transaction.

Greencap chairman Byram Johnston said the board’s primary concern was to act in the best interest of the company’s shareholders.

“The directors believe the proposal from Wesfarmers reflects compelling value for Greencap’s shareholders, delivering cash proceeds in an uncertain economic environment at a significant premium that appropriately reflects the strength of Greencap’s business,” Mr Johnston said in a statement.

If the scheme is approved and implemented, Greencap will become part of the wholly-owned Wesfarmers Industrial and Safety subsidiary.

Managing director Olivier Chretien said Greencap would complement WI&S's safety training, on-site and technical services.

Miles Advisory Partners is acting as Greencap’s financial adviser, with Herbert Smith Freehills appointed for legal advice.

Gilbert + Tobin is acting as legal adviser to Wesfarmers.