Shares in FirstGroup have risen from a recent average of around the 110-115p mark to almost 130p following the announcement by FirstGroup of a new takeover bid by investment fund I Squared. In a statement, FirstGroup said it ‘notes the recent share price movement’ and that it had ‘received a series of unsolicited, conditional proposals from I Squared Capital Advisors in relation to a possible offer to acquire the entire issued, and to be issued, share capital of the company.’
The Aberdeen-based group said its Board, together with its advisers, was evaluating the latest approach, received on the evening of 25 May, which provides for a cash component of 118 pence per share and a contingent right to up to a further 45.6 pence per share based on the outcome of the First Transit earnout and the net proceeds realised from the Greyhound legacy assets and liabilities. The previous approaches were all unanimously rejected by the Board.
The Group ‘strongly advised’ shareholders to take no action in relation to the approach from I Squared, and said that a further announcement will be made if and when appropriate.
I Squared is required to either announce a firm intention to make an offer for the company or announce that it does not intend to make an offer by no later than 1700hrs on 23 June. FirstGroup added that there is no certainty either that an offer will be made nor as to the terms of any offer, should one be made.
The bid values the firm at a minimum of almost £900m, with a possible additional £350m, depending on future results. First sold its US school bus and Greyhound divisions last year for $3.3bn.
