THE battle to control M.P Evans entered a new phase last week when the board members of the palm oil producer called on shareholders to reject a second attempt by Kuala Lumpur Kepong (KIK) at a hostile takeover.
Directors at the Tunbridge Wells business, which is situated on Clanricarde Gardens, said the latest offer from the Malaysian firm: “Continues to fail to recognise the true value of the company and its unique position within its industry.”
The stakes had been raised after KIK had previously been rebuffed by the company’s board at the end of October when offering to buyout M.P Evans for 640p per share.
This rejection led KIK to attempt a hostile takeover by approaching shareholders but, despite this offer sending the share price sawing by 45 per cent in one day, shareholders took the advice of M.P Evans to reject it.
Unperturbed, the Malaysian plantation giant re-raised its bid to 740p per share, valuing the company at £415.4million and representing a premium of 74 per cent on the closing price recorded on October 24.
But their second offer met with the same response from M.P Evans board members on Friday 16 who went on to urge shareholders to reject direct offer for the second time four days later.
The next day, the AIM-listed company announced it had received the ‘immediate and unequivocal’ support of shareholders representing in aggregate 40.85 per cent of the firm’s issued share capital.
M.P Evans Chairman Peter Hadsley-Chaplin said the offer ‘very substantially’ undervalues the company adding: “MP Evans is worth very substantially more than 740 pence per share. The board’s view in this regard is corroborated by the early and unequivocal support of a large proportion of our shareholder base. Shareholders’ best interests are served by rejecting this offer.”
KIK responded by saying the increased offer is final and is ‘not capable of being increased’.
However the firm left itself some wiggle room to try again by stating it ‘reserves the right’ to increase the price per share payable if there if the M.P Evans board recommends a higher offer by KIK to its shareholders or if another party also shows an interest.