Shawbrook rejects third buyout offer from private equity groups

LONDON: British challenger bank Shawbrook Group Plc said it rejected a raised and final £868 million offer from private equity groups trying to take control of the lender.
“Independent directors believe that the final offer undervalues Shawbrook and its prospects and therefore advise that shareholders take no action with regards to the final offer,” Shawbrook said in a statement on Tuesday.
Marlin Bidco, the buyout vehicle set up by BC Partners and Pollen Street Partners, on Monday raised its offer for Shawbrook by just over 3 per cent, as the bidders try to convince another 5 per cent of shareholders to accept the deal.
Shawbrook said that it can grow “prudently” over the medium-term and reach its return on equity targets without being taken over.
“This decision is ill-advised,” analysts at RBC Europe wrote in a research note following the announcement, saying the bidders could now walk away from the deal and that other buyers were unlikely to emerge.
The latest offer represents a 27 per cent premium to Shawbrook’s closing share price on March 2, a day before the lender first received a bid from the private equity firms. The offer will now remain open until June 19.
The private equity groups already hold 38.8 per cent of Shawbrook shares and have so far received acceptances from investors holding another 6.6 per cent of the stock, leaving them just under 5 per cent short of the required 50 per cent backing needed for the deal to go through.
The consortium first made its bid for Shawbrook in January offering 307 pence per share, upping it to 330 pence in March. — Reuters