3rd Jun 2016 06:40
LONDON (Alliance News) - Two private investment management firms on Friday said they are considering making an offer to acquire Source BioScience PLC, adding the offer price would be at a premium to the stock's closing price on Thursday.
Continental and Hardwood Capital released a joint statement that said they are "in the process of evaluating and preparing for a possible offer" for the entire issued share capital of Source BioScience, a London Main Market-listed provider of laboratory services and products.
Although the offer is not firm, the two investment management firms said the offer would be 18.0 pence per Source BioScience share, which is a 22% premium to the company's closing share price on Thursday of 14.78p.
Source BioScience currently has a market capitalisation of around GBP51.7 million and an offer at 18.0 pence per share would be worth GBP62.9 million.
Certain clients that are advised by Continental already hold 25.5 million shares in Source BioScience, representing a 7.29% stake, whilst clients of Harwood currently hold 82.5 million shares in Source BioScience, equal to a 23.62% stake.
That means the two potential bidders already hold a combined stake 30.91% in Source BioScience.
In addition, the pair have obtained letters of intent from other Source BioScience shareholders with a further holding that is equal to a 19.96% stake in the company, meaning they hold or control a total of 177.7 million shares in Source BioScience, equal to a 50.87% stake.
Source BioScience released its own statement on Friday morning confirming it had received a preliminary approach from Continental and Harwood but said it will set out its opinion on the potential offer only once the formal terms have been proposed.
The two investment management firms said the offer will not increase, but said it could make an offer lower than 18.0 pence if the Source BioScience board agrees and recommends a lower offer or if Source BioScience declares, makes or pays any dividend or additional distribution to its shareholders.
Continental and Harwood will have until the first day of July to make a firm offer or walk away from the deal, under London rules.
By Joshua Warner; [email protected]; @JoshAlliance
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