Informa says no to revised cut-price bid
Informa last night rejected a cut-price bid from a private equity consortium, led by Providence, slamming the 450p a share offer as “significantly undervaluing” the publisher.
City PM’s exclusive revelation yesterday that the consortium had slashed its initial bid by more than 10 per cent to 450p a share caused a stir in the financial markets.
The news sent the publisher’s shares plummeting and forced the consortium to formally lay its offer on the table.
The revised bid was bolstered after a rival consortium made up of Blackstone and Dubai World Trade Centre pulled out of the race because the two could not agree on a price for Informa.
Peter Rigby, Informa’s chief executive, last night rubbished Providence’s reasons for lowering its bid.
He told City PM: “When the letter arrived today [yesterday] we were surprised at how low the bid was, considering the earlier offer. We have not changed at all, we still have a strong events business and subscription income.” He added: “The consortium will be able to gauge from the market’s reaction that their offer was significantly lower than acceptable.”
Rigby, said the ball was now firmly in the consortium’s court to come back with a higher offer, adding yesterday’s bid had been a “long time coming” since the publisher was first approached in June.
Informa’s major shareholders, which include Standard Life and Fidelity, are understood to have been furious with the consortium’s lower offer and the fact that news of it had got out before it had been formally put to the board.
The consortium has secured financing from 12 banks, but City analysts were sceptical a deal would be finalised. Panmure Gordon analyst Alex de Groote said 450p was “unsatisfactory.”