8th Feb 2021 09:33
(Alliance News) - TDR Capital LLP on Monday said a fourth potential takeover offer for Arrow Global Group PLC has been accepted by the financial firm's founder and chief investment officer.
TDR, a private equity firm, is offering 305 pence per share in cash, up from its most recent 290p per share offer, which had been rejected by Arrow's board back in January.
Shares in Arrow were up 26% at 290.05 in London in Monday morning.
Manchester-based Arrow buys debt from banks, credit card companies and telecommunications businesses.
Before its third offer of 290p in January, TDR had made a 205p per share initial proposal back on December 2, followed by a 265p per share offer on December 8. All three offers were rejected by the Arrow board.
The new 305p per share offer is an approximately 67% premium to Arrow's 182.3p average share price for the three months ended Thursday last week, TDR noted, and a 36% premium to its closing price of 224.0p on Thursday. Arrow Global shares had added 3.8% on Friday to close at 231.50p.
Zachary Lewy, Arrow's founder & CIO, has entered into a binding letter with TDR confirming his full support for the fourth proposal and intention to vote in favour. TDR said Lewy "is fully supportive of the fourth proposal". The letter grants TDR exclusivity, and Lewy will not support any other offer for Arrow, TDR said.
However, it added: "There can be no certainty that any further proposal or firm offer will be made, nor as to the terms of any further proposal or firm offer. A further announcement will be made if and when appropriate."
TDR has until March 8 to makes a firm offer or announce its intention not to do so.
Jefferies highlighted that the deal is still only 3% higher than Arrow's share price levels in early 2020 and below Jefferies' 420p per share valuation.
By Anna Farley; [email protected]
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