Group Five sags as Greenbay offer lapses


Group Five sags as Greenbay offer lapses

Published Date: 2017-10-23 | Source: Stephen Gunnion | Author: Stephen Gunnion

Group Five sags as Greenbay offer lapses

It says an independent board didn't have enough time to "opine" on the offer

Group Five has turned away from a R1.6 billion offer for its European business, including its lucrative Intertoll Europe management contract, saying it wasn't given enough time. Ahead of a 5 pm deadline to accept or decline the offer from Greenbay Properties, it said the week's notice it was given was insufficient for an independent board to make a recommendation to shareholders.

Greenbay's offer, made on the 13th and announced last Monday, was worth more than the entire market capitalisation of Group Five. It had already given the Takeover Regulation Panel a cash confirmation letter confirming it was good for the money and said it had the capital and the operating experience in Europe to grow the business. Although Group Five asked for more time as the timeline was impractical, it said Greenbay was unwilling to consider an extension "merely to allow Group Five to pursue other possibilities".

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The independent board's preliminary observation was that the offer substantially undervalued the targeted assets and Group Five says it continues to receive expressions of interest in the targeted assets, as well as some of its other businesses.

The construction and infrastructure group has been under pressure from shareholders, most notably Allan Gray, to change direction and unbundle or sell its investment and concessions business.

Group Five's shares added 25% last Monday after it informed the market of Greenbay's offer. They fell 14.4% to R10.70 on Friday.

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