21st Dec 2015 09:39
LONDON (Alliance News) - Construction firm ISG PLC Monday confirmed its board members unanimously rejected the unsolicited takeover offer made by Cathexis UK Holdings Ltd because they feel it materially undervalues the company.
ISG already made an announcement that it would be rejecting the offer, confirming it Monday by sending a formal response to shareholders detailing its reasons for not recommending the offer.
"Cathexis is an astute investor which has shrewdly built up its shareholding in ISG. The board urges shareholders not to give away your value in ISG at today's inadequate offer price," said ISG Chairman Roy Dantzic.
Cathexis already holds a 29.5% stake in ISG and has been a shareholder since 2012. The offer made was for 143.0 pence per ISG share, valuing the business at around GBP70.8 million.
ISG shares were trading up 0.6% to 141.80 pence per share on Monday morning.
"Cathexis...has bought its ISG shares at times when the share price has been low and now sees further value in your ISG shares at your expense," ISG wrote to shareholders.
ISG said the offer fails to reflect the recent growth and future potential of its core fit-out business, adding Cathexis is trying to take control of the company without paying an adequate premium.
"In the meantime, all ISG shareholders are advised to take no action whatsoever and to ignore the offer," ISG said.
Cathexis said it has posted its offer document to ISG shareholders, with the offer remaining open until January 11.
By Joshua Warner; [email protected]; @JoshAlliance
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