Takeover target Hellaby hints at possible breakup on its own terms
Bapcor is planning to delist Hellaby if its takeover is successful.
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Hawke’s Bay
Hellaby Holdings, which is engaged in a battle to fend off unwanted suitor Bapcor, has told shareholders it could move to break up the company to realise shareholder value.
Australian car parts company Bapcor raised its offer to $3.60 a share earlier this week from $3.30 but the independent directors of Hellaby said they could not recommend the offer unless it included an 18c per share dividend. Bapcor has refused this and the Takeovers Panel has now ruled the offer price of $3.60 a share is a last and final offer.
Hellaby chairman Steve Smith said the offer price still did not reflect fair value for the shares.
"Your company has other options. We could continue under our growth strategy, communicated in May 2016, which we believe will deliver attractive long-term value to shareholders, or we too could break up the company and realise the value embedded in each group in an orderly and careful process over time."
Bapcor is planning to delist Hellaby if its takeover is successful and focus on the automotive segment. The equipment, resources and footwear businesses would be sold.
The Australian company has the support of 40% of investors at $3.60 a share, and today's update from Hellaby highlights that if Bapcor controls more than 50% of the shares, it could become the majority shareholder.
"If Bapcor did so, it would represent a different set of risks and opportunities for Hellaby shareholders ... this scenario would pose a number of significant complexities for Bapcor as it would not be able to fully realise the synergies of complete ownership," the note to investors said.
Bapcor requires 90% of shareholders for the full takeover offer to succeed.
Hellaby shares traded at $3.03 before to the takeover offer emerging. Late afternoon yesterday, they were up 0.3% on yesterday's closing price, at $3.46. They've risen 17% since the start of the year.
(BusinessDesk)
Edwin Mitson
Fri, 09 Dec 2016
Fri, 09 Dec 2016
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Takeover target Hellaby hints at possible breakup on its own terms
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