PGR board rejects takeover bid
Published 07-OCT-2015 08:50 A.M.
|
1 minute read
Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.
In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.
The below articles were written under our previous business model. We have kept these articles online here for your reference.
Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.
Click Here to View Latest Articles
The directors of PAS Group (ASX:PGR) have rejected a takeover offer from Australia Brands Investment, labeling it “opportunistic”, but said that it would test the waters with other parties about a takeover.
Last month it received a 63c per share all-cash takeover offer from ABI, acting for Coliseum Capital Management.
Discounting the shares ABI did not already hold, the deal was worth $69.5 million.
Accounting for the 19.23% of PAS shares held by ABI, the deal valued PAS at about $86 million – an amount PGR directors said undervalued the company.
“PAS is well managed and has achieved stable year on year sales growth, a high level of cash generation and growing returns. PAS Shares also offer an attractive dividend yield,” it told investors in its formal response to the bid.
“Your directors consider that you will be better off retaining your PAS Shares, rather than exiting your investment in PAS for $0.63 cash per Share by accepting ABI’s Offer.”
While it lauded the management expertise of Coliseum, it said it would enter talks with other parties about a potential takeover bid.
Since the bid was launched, PGR shares have traded above the offer price, but not going above the 65c mark making its current price 2c higher than the offer price.
PGR is a fashion retailer with a stable of fashion brands under its purview, including Metalicus, Marco Polo, and White Runway.
However, it also licenses brands such as Slazenger, Everlast, Dunlop, and Disney.
During the 2015 financial year, PGR delivered a net profit after tax of $8.8 million from underlying earnings before interest and tax of $20.2 million.
General Information Only
This material has been prepared by Jason Price. Jason Price is an authorised representative (AR 000296877) of 62 Consulting Pty Limited (ABN 88 664 809 303) (AFSL 548573) (62C), and a Director of S3 Consortium Pty Ltd (trading as StocksDigital).
This material is general advice only and is not an offer for the purchase or sale of any financial product or service. The material is not intended to provide you with personal financial or tax advice and does not take into account your personal objectives, financial situation or needs. Although we believe that the material is correct, no warranty of accuracy, reliability or completeness is given, except for liability under statute which cannot be excluded. Please note that past performance may not be indicative of future performance and that no guarantee of performance, the return of capital or a particular rate of return is given by 62C, Jason Price, StocksDigital, any of their related body corporates or any other person. To the maximum extent possible, 62C, Jason Price, StocksDigital, their related body corporates or any other person do not accept any liability for any statement in this material.
Conflicts of Interest Notice
S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.
Publication Notice and Disclaimer
The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.
Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.
This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.
