Belgian firm makes £348m hostile bid for Lavendon
Belgian materials handling firm is to make a £348m bid for Leicestershire rental powered access firm Lavendon.
TVH, which is a major global player in the materials handling market, wants to buy Lavendon to access its lucrative Middle Eastern business.
TVH approached the Board of Lavendon in September 2016 regarding a possible offer with an offer of 180 pence in cash per Lavendon share. Following negotiations with Lavendon, TVH increased the proposal to a price of 200 pence in cash per Lavendon share.
On 14 November 2016 TVH indicated to Lavendon that it intended to increase the possible offer price to 205 pence in cash per Lavendon share.
On 16 November 2016, the Board of Lavendon informed TVH that, in light of further discussions with certain shareholders, Lavendon had unanimously concluded that it no longer intended to recommend an offer whether at 200 pence or 205 pence in cash per Lavendon share.
On 18 November 2016, having considered the response of the Board of Lavendon, TVH proposed changing the offer structure from a scheme of arrangement to a contractual offer. The Board of Lavendon met to consider the revised proposal over the weekend of 19 November 2016 and subsequently informed TVH that it would only be prepared to recommend such an offer if TVH secured the support of more shareholders.
TVH says it is going public with the new offer in order to provide Lavendon’s shareholders with “the opportunity to make their own decision as to the attractiveness of the offer”.
Pascal Vanhalst, member of the Executive Board of TVH, said: “The acquisition of Lavendon would represent a significant step forward in the growth of our specialised rental activities. It would also bolster our geographical expansion strategy as TVH Equipment would become active in new markets such as the UK, the Middle East and France. With Lavendon’s vast rental know-how and focus on safety, the customers of the enlarged group would clearly benefit.
“Our strong preference has always been to announce an offer with the full support of the Board of Lavendon. TVH, Lavendon and our respective advisers worked together towards a firm offer announcement at a price of 200 pence per share in cash, which the Board of Lavendon intended to recommend. Following discussions with certain shareholders, we increased our proposed offer price to 205 pence in cash.
“Despite the increase, the Board of Lavendon withdrew its support on the grounds of concerns around deliverability of a scheme of arrangement. To address the Board’s concerns and secure its support, TVH proposed changing the structure to a contractual offer, however the Board of Lavendon continued to be unwilling to recommend the offer.
“TVH believes the offer fully values the Company and its prospects and has therefore decided to release this firm offer announcement to allow Lavendon shareholders to decide on the merits of the offer.”
In reponse, Lavendon issued a statement this morning, saying: “The Board confirms that it received an unsolicited approach from TVH after Lavendon’s Half Year Results in August 2016. Following preliminary discussions, a non-binding proposal was received on 16 October 2016 from TVH regarding a possible cash offer for Lavendon to be effected by way of a Scheme of Arrangement and subject to certain pre-conditions including a limited amount of due diligence and the support of Lavendon’s major shareholders. Following further negotiations and once the limited due diligence was complete, TVH sought the support of Lavendon’s major shareholders. Following discussions with these shareholders, TVH indicated that a price of 205 pence per Lavendon share was the maximum price it would be prepared to pay.
“Having consulted with certain of the shareholders approached by TVH, it was apparent that the level of support anticipated was not forthcoming. Consequently, the Board unanimously concluded that it was unable to proceed with a recommended offer, regardless of the proposed offer structure, due to concerns over the significant execution risk and the potential disruption to Lavendon’s business. The Board subsequently encouraged TVH to approach additional shareholders to establish whether TVH could secure further support but they declined to do so.
“The Lavendon Board advises shareholders to take no action at this stage.
“A further announcement will be made in due course.”
