10th Dec 2015 08:45
LONDON (Alliance News) - Packaging company Powerflute Oyj on Thursday said it has received a preliminary takeover proposal which it is currently considering and said trading in the second half of 2015 had been in line with its expectations.
The group said it has received a preliminary proposal from American private equity firm Madison Dearborn Partners LLC for 90.00 pence in cash for shares held by shareholders other than Dermot F Smurfit and Bacchantes Ltd, the investment vehicle run by Michael Smurfit.
It would then pay 79.00p per share for those shares held by Dermot F Smurfit and Bacchantes, plus another 6.00p based on Powerflute hitting earnings targets. Smurfit and Bacchantes hold around 36% of the company.
The offer would value Powerflute, including the contingent consideration, at around GBP261.5 million, compared to the company's current market capitalisation of GBP259.3 million. Shares in the company were down 1.4% to 90.2624p early Thursday.
Michael Smurfit is advising Madison Dearborn on the deal, Powerflute said, and its board of directors, excepting Dermot F Smurfit and Dermot S Smurfit will now evaluate the offer. Powerflute didn't provide a reason for the difference in the price of the offer to the Smurfits compared to other shareholders.
Powerflute also said trading in the second half of 2015 has remained strong for its Coreboard and Cores and Packaging Papers divisions and said its outlook going into 2016 remains positive.
The Coreboard and Cores business has been boosted by continued favourable market conditions in the US and has maintained margins in China despite increasing competition in the market. Conditions for the Packaging Papers unit have softened, the company said, but remain robust.
By Sam Unsted; [email protected]; @SamUAtAlliance
Copyright 2015 Alliance News Limited. All Rights Reserved.
Related Shares:
POWR.L