Johns Lyng shares skyrocket on $1.1b takeover by Pacific Equity Partners
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More news: Shares in Johns Lyng Group shot up in morning trade after the board of the building services provider unanimously recommended that shareholders vote in favour of a proposed takeover from private markets investor Pacific Equity Partners.
Johns Lyng’s share price rallied 22.2% to $3.88 by 11:23am AEST.
Johns Lyng board backs $1.1b takeover by Pacific Equity Partners
The news: The board of Johns Lyng Group has unanimously recommended that its shareholders vote in favour of a proposed takeover of the building services provider by private markets investor Pacific Equity Partners (PEP), announced last month.
The numbers: The acquisition would see PEP acquire 100% of Johns Lyng's shares at a price of $4 per share. It implies a premium of 77% to the closing share price at 15 May, when the offer was first made. Johns Lyng shares last closed at $3.18.
The offer represents an equity value of $1.1 billion and implies an enterprise value of $1.3 billion.
The context: Johns Lyng's board has unanimously recommended that shareholders vote in favour of the scheme of arrangement. The company's largest shareholder — managing director and chief executive Scott Didier — will vote his 17.64% share in favour of the move.
Shareholders are set to vote on the scheme in October.
What they said: "The scheme is an attractive transaction that provides [Johns Lyng] shareholders with the opportunity to receive cash at a material premium," said Johns Lyng chairman Peter Nash.
"The independent board committee's unanimous recommendation was based on a thorough evaluation of a range of factors including Johns Lyng's intrinsic value under different scenarios and the potential medium-term share price without the scheme, and taking into consideration Johns Lyng's underlying business performance over the last two years and current business momentum."
The source: ASX
