Spotless Group reported to the Australian Stock Exchange on 9 May that it had ‘received an indicative, non-binding and conditional proposal from a private equity firm to acquire 100% of the shares of Spotless via a scheme of arrangement at an indicative price of $2.50 in cash per share.
‘The Spotless directors have review the proposal in detail and believe that it does not reflect the fundamental value of the company in the context of a change of control.’
According to the Sydney Morning Heralds’ Business Day (10 May), the $657 million takeover offer came from Blackstone. Despite the Spotless rejection, it is believed that the door remains open for an improved offer from suitor Blackstone.
One institutional investor, Investors Mutual director Anton Tagliaferro, is quoted by Business Day as saying Spotless has been ‘a very disappointing company for a long time’. He added that Spotless directors should explain why the share price is worth a lot more than what was offered by Blackstone.
However, another investment manager, Aberdeen Asset Management’s Andrew Preston was quoted as saying he thought the bid did undervalue Spotless given that there was significant potential upside if economic conditions improved and it started to win more catering and cleaning contracts.