Bus maker Alexander Dennis (ADL) has ended its brief skirmish with India’s Ashok Leyland for control of rival firm Optare.
ADL, which is backed by Stagecoach founder and chief executive Sir Brian Souter, walked away after hearing Ashok had no intention of selling its shares in Optare “to anyone at any price”.
A £12 million credit line will be made available to Optare if shareholders back the cut-price issue of shares to Ashok at a meeting on January 6. Optare has warned it would be unable to continue trading if the share placing fails to go through.
ADL said on December 28, 2011, it had asked Optare to open its books so it could decide whether to make a rival offer for the firm.
Optare’s shares rose by 50% at one stage but the prospect of a bidding war proved short-lived after Optare’s financial adviser told ADL that Ashok has no intention of selling up.
Optare has an order book worth £59m after it recently unveiled a contract to supply 190 of its Solo SR midibuses to Cape Town in South Africa (CBW1015). Components will be supplied by Optare and assembled by South African firm Busmark 2000 at a new plant in Cape Town.
The current order book, which compares to £34m in January, stands to get a further boost following the Government’s recent announcement of a further round of ‘green’ bus funding from April.