APM shares rocket as board endorses Madison Dearborn Partners takeover offer
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More news: Shares in APM Human Services soared 10.6% to $1.38 by 11:40am AEST after the company recommended a takeover offer.
The improved takeover bid from its largest shareholder US private equity firm Madison Dearborn Partners (MDP)offered $1.45 per share.
MDP's previous offer of $1.40 per share saw APM shares move in the opposite direction in April.
APM enters takeover agreement with Madison Dearborn Partners
The news: APM Human Services has recommended its shareholders accept an improved takeover offer from its largest shareholder US private equity firm Madison Dearborn Partners (MDP), valuing the company at $1.3 billion.
The numbers: APM has entered into a scheme implementation deed with MDP subsidiary Ancora BidCo, which will see APM shareholders will receive $1.45 cash per share.
The cash consideration values the ordinary shares of APM at approximately $1.3 billion and represents a premium of 74.7% to APM's closing share price on 16 February, the trading day prior to rival suitor CVC Asia Pacific's submitting its initial proposal.
Currently, MDP holds a 29% stake in APM and has three directors on the board. Its improved offer of $1.45 per share is up from $1.40 previously tabled, which saw APM's shares tumble in April. APM shares last closed at $1.25.
The context: APM's board has unanimously recommended that its shareholders vote in favour of the scheme, in the absence of a superior proposal and subject to the review of an independent expert.
The company said that implementation of the scheme is expected to take place before the end of the calendar year.
APM’s independent board committee, which was formed to evaluate potential takeover offers, previously rejected a takeover bid by private equity firm CVC. CVC then made an improved offer but subsequently was “unable to finalise a transaction”.
In a trading update, APM also flagged that low client flows in its employment services businesses in Australia and the UK have weighed on earnings in April and May, and expects underlying EBITDA and underlying NPATA for FY24 around the "bottom end" of its previously stated guidance.
The source: ASX announcement
