16th Jan 2017 10:39
(Correcting attribution of statement from Dee Valley on transferred shares)
LONDON (Alliance News) - Ancala Fornia Ltd on Monday said it will leave its takeover offer for Dee Valley Group PLC open to acceptances while a UK court determines the result of a rival bid for the business from Severn Trent PLC.
Investment company Ancala and Severn Trent have both been battling over Dee Valley, the owner of Wrexham Water & Cheshire Waterworks and the last water-only stock left listed in London.
Severn Trent's offer for Dee Valley is currently higher than the one made by Ancala, but the latter has already locked in some significant irrevocable undertakings from certain shareholders of Dee Valley, and also received the backing of Dee Valley's Employee Forum.
However, the recommendation of the board of directors of Dee Valley lies with Severn Trent.
Dee Valley shareholders voted in favour of the proposed offer from Severn Trent last week, but then Dee Valley said it had come to its attention that a series of around 445 recent transfers of small holdings in voting ordinary shares have taken place, which could "distort" the outcome of the shareholder vote at the court meeting.
Dee Valley said its board considers it appropriate for the court to determine if the holders of the voting shares transferred should count for the purposes of voting on the scheme at the court meeting.
Dee Valley said a poll vote which did not include the transfer shares cited on Wednesday saw the takeover by Severn Trent passed by 92% to 8% of its shareholders. At its general meeting of shareholders, 87% voted in favour of the scheme.
But, Dee Valley said that if the transferred shares had been accepted in the vote, the proposal would have been rejected by 56% of shareholders.
The takeover still remains subject to approval by the court at the sanction hearing, which has now been pushed back to January 25.
On Monday, Ancala said it has received valid acceptances from Dee Valley shareholders with a combined stake of 41.16% stake in the company. Ancala said it is still willing to make market purchases of Dee Valley shares at its offer price for voting shares of 1,706.0 pence each.
Ancala noted the developments concerning the offer for Dee Valley by Severn Trent, and said its offer "can remain open for acceptances whilst the court determines the final outcome of the vote" related to Severn Trent's bid for the company.
Ancala has extended its offer until January 27.
By Joshua Warner; [email protected]; @JoshAlliance
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Related Shares:
Severn Trent