As we reported briefly in last week’s issue 1529, Go-Ahead Group announced that it had received two takeover bids. One from the Kelsian Group, owners of Tower Transit, and the other from a consortium consisting of Kinetic and Globalvia, which have since formed Gerrard Investment Bidco Limited to facilitate the takeover.
The boards of directors of Gerrard Investment and the Go-Ahead Group say they have reached agreement on the terms of a recommended cash acquisition pursuant to which Gerrard will acquire the entire issued and to be issued share capital of Go-Ahead.
The acquisition values the share capital of the Go-Ahead Group at approximately £647.7 million. Under the terms of the acquisition, Go-Ahead shareholders will be entitled to receive 1,500 pence for each Go-Ahead Group share, comprising, for each Go-Ahead Share: 1,450 pence in cash and a special dividend of 50 pence per share, in lieu of a final dividend for the year ending 2 July 2022.
Christian Schreyer, Go-Ahead Group Chief Executive, said: “This is a compelling offer which combines an attractive valuation for shareholders with bright prospects for Go-Ahead’s operations and colleagues around the world. We have confidence in Go-Ahead’s future as an independent business but see that being part of a truly global mass transit platform will yield exciting opportunities.
“We welcome the commitment of Kinetic and Globalvia to invest in the decarbonisation and digitalisation of our operations, and to support our strategy, ‘The Next Billion Journeys’.”
Talking to City AM, Michael Sewards, Chief Executive of one of the consortium’s two partners, Australian bus operator Kinetic, said: “Our offer presents a very strong premium. We think now more than ever that presents a very very compelling case and we’re confident it will be approved.
“We are looking to retain the existing business as a standalone business, with all team members to be retained as well as the chair and chief executive. We think our approach provides a lot of security for the people in the business but also for the suppliers and manufacturers who provide services to Go-Ahead.”
Whilst the Go-Ahead Group is backing the Gerrard deal, Kelsian has urged shareholders to take no action as its own discussions are ongoing. Kelsian says it believes that the potential combination with the Go-Ahead Group would create an international leader in multi-modal and mass transit with strong growth prospects, highlighting that it already has experience operating in the UK through Tower Transit.