Empiric Share Chat (ESP)

You would be absolutely mad to approve the UNITE offer.

Our management need to be investigated for still supporting this deal.

I wonder if they are more interested in lining their pockets than safeguarding shareholder value?

This deal has destroyed shareholder value.

CRIMNAL DISGRACE.

Been looking at shares I once held, I noted the offer from Unite way back in June 24 of about 107p from recollection. i thought that with the esp sp at 79p what a bargain - until I dig deeper and find that the Unite share price has plummeted since and 79p reflects this. Shame on Unite, I would walk away from this deal personally

WALK AWAY FROM UNITE DEAL

- If management do not reverse their approval of Unite merger they need to be criminally investigated.

- the deal is awful: because of UNITE UTG awful operations and share price, as of writing the value of the offer in UTG and cash is 81.5p ... they can go to hell.

VOTE AGAINST THE DEAL

What an * fest this is turning into.

Due to London & South East's limit on the amount of text in a comment, I was unable to include the following in my comment on Friday 22 August:

- On Friday 22 August ESP opened below 92p, by 9am the spread was 92.3 to 92.4 and for most of the day it traded in a narrow range. From about 9:50 am to 3 pm from the spread was 92.7 to 92.8, the quantity bought was more than double the quantity sold.

- From about 3 pm the spread went progressivley higher through the gears via 92.8 to 93.0 to peak at 4:14 pm at 93.6 to 93.8. By then there were more sales in the mix but by the close, and ignoring the uncrossing trade and the trades which followed it, the number bought was still about double the number of shares sold.

- On Friday there were many individual purchase trades involving batches of 2,000, 3,000, 4,000, 5,000 and 6,000 shares.

- Until Friday I hadn't seen such a trading pattern on any day since I bought ESP on 13 August.

- As I said in my 22 August comment, from about 3pm on Friday the bidder Unite [UTG], whose shares are oversold, began a fairly steep rise and closed up nicely but ESP were up even when UTG were down.

- My experience with other cash-and-shares bid situations in the last year or so (e.g. Aviva for Direct Line, and Greencore for Bakkavor) is that at this stage in the takeover process the target is usually sits at a discount of about 5% to the value implied by the bidder's share price, but for much of Friday ESP's mid-price at any given time was 98 to 99% of the value implied by UTG's share price at that time.

- Friday's closing price of 735.5 for UTG implies a value of 94.5175 for ESP. However, ESP closed at 93.7 which is 99.135% of the implied value, i.e. a miniscule discount of 0.865% to the implied value.

- Either UTG is about to get re-rated to reverse its oversold position and traders are buying both UTG and ESP in the hope of profiting from the re-rating, and/or there's another potential bidder sniffing around ESP. Of course if there's another bidder they might be prepared to offer more than UTG is prepared to pay, and if the market thinks that a counter-bidder is likely to succeed there's likely to be a reversal in whole of in part of UTG's share price drop of about 14% since their approach for ESP was annonced on 5 June.

- After being a few hundred pounds down on paper for most of the time since I bought ESP on 13 August, at Friday's close I was under £50 down.

Within the next couple of minutes I'm going to add a comment almost identical to this one to London & South East's chatboard for UTG.

You would be deluded to accept this offer.

Personally I’m going to vote against when the time is right. If it comes to that.

Well under what my average so is. Getting fed up of all these take overs and wind downs as long term holders losing out again and again.

MattTheBrave indicated on 15th August below that I've been silent since the bid announcement.

My comment on Wednesday 13 August said that I believed that UTG dearly wanted to buy ESP so I bought at just under 93.5p per share which was close to that day's low and nearly ESP's lowest since UTG's approach was announced on 5 June. UTG's formal offer came at 7am on Thursday 14 August as I'd expected, but was seriously underwhelming.

Echoing MattTheBrave's and legsofman's comments here and other people's comments on ADVFN on 14 August:

- UTG shares fell by 14.4% from 855.5p the day before their approach was announced to just 732p on 13 August meaning that their formal cash-and-shares offer valued each ESP share at 94.22p which is 11.94% less than ESP's implied value of 106.995p at the time of UTG's approach was announced.

- My 13th August comment indicated that I expected UTG to borrow some cash to enable their formal offer to have a higher cash element to bring its value closer to 106.995p per ESP share, because there is headroom to increase their gearing.

- So how on earth, in the context of a 14.4% fall in UTG's share price, could ESP's board agree to recommend UTG's offer with a small increase in cash of 2p per share and a reduction from 0.09 to 0.085 UTG shares per ESP share?

I have the following addiitonal comments / questions:

- ESP shareholders could reject UTG's bid.

- I'm sure that many of the big ESP shareholders (e.g. funds such as Blackrock) are also large UTG shareholders. Does anyone know how the big guys are going to vote?

- At today's closing price, ESP's market capitalisation is about £622 million. We all hoped that the value of UTG's formal offer would be 107p per share, valuing ESP at about £710 million. What is the chance of a counter-offer from a white knight?

- KKR and their collaborator Stonepeak were prepared to pay £1.64 billion in cash for another REIT, Assura, but PHP's final cash-and-shares offer won the shareholder vote. Would KKR be interested in buying ESP for about 107p per share which we we all wanted?

Due to UTG's formal offer being lower than I'd expected, I didn't make the hoped-for quick profit of at least 4% overnight from buying on 13 August to 14 August when the formal offer was announced.

Since the formal bid announcement:

- On Thursday 14 August and (if I remember correctly) Friday 15 August I could sell ESP for a profit of between about £15 and £60. Most of the time I've been down several hundred pounds. I've continued to hold in the hope of a UTG share price recovery (they're UTG oversold) or a better counter-bid.

- Today ESP were up almost all day even when UTG were down. From about 3pm both ESP and UTG began a fairly steep rise and closed up nicely. I hope the recovery carries on next week.

- Maybe the market expects a counterbid from a third party.

I'm going to add a comment almost identical to this one to London & South East's chatbo

BNI been quiet since the announcement.........For clarity, I have not added a near identical post to UTG because I can't be ar5ed :-)

Shafted again. Not a happy shareholder!

nope.....:-( - no increase in cash component or **************. why has the bod allowed this to still be recommended after the effective bid price has fallen by over 10%? do they think their nav has fallen 10% in 2 months?? looks like they have allowed shareholders to be legged over on this one! also, shows why (mostly) share deals are so much worse than cash!!

In a few moments I'm going to add a comment almost identical to this one to London & South East's chatboard for UTG.

My guess is that UTG dearly want to acquire ESP and that they're likely to make a formal offer, so late this afternoon I bought some ESP at just under 93.5p per share which is close to today's low. The price which I paid is also near the lowest ESP have been since UTG's approach was announced.

The fall in ESP's share price since it closed at 104.8 on 10 June reflects the drop in the UTG share price since their approach to take over ESP was announced on 5 June. UTG has fallen to successive 5 year lows since 5 June.

I think that UTG have to increase the cash element to bring the value of their proposed offer to nearer 106.995p per ESP share which it was when the initial announcement was made on 5 June. I suspect that they'd have to do this by increasing their gearing which if I remember correctly isn't particularly high at the moment.

Unless UTG's put-up-or-shut-up deadline is extended for a third time, there's the possibility of a bid announcement being made any time before 5 pm tomorrow. Coincidentally, ESP are expected to announce their results for the half-year to 30 June 2025 at 7 am tomorrow. It's possible that the agreed terms for a takeover bid might be announced at the same time.

Obviously there's a risk of UTG announcing that they won't be making a formal bid. In that case, in the short term ESP might fall quickly by 6% to 8% to something like 88 or even 86p. It's also possible that negotiations between UTG and ESP are still continuing. In that case there's likely to be an announcement of a third extension of the PUSU deadline to allow more time to complete due diligence and/or to finalise offer documentation and/or for UTG to sort out arrangements for financing any bid.

If a formal offer for ESP is announced tomorrow, I expect ESP shares to go up by about 4% to 8%. That would be a good overnight profit for me and anyone else who bought in the last fortnight.

REMINDER:

- The announcement on 5 June said that UTG's proposal was 30p cash and 0.09 new UTG shares per ESP share, and that at UTG's closing price of 855.5p on 4 June 2025, this valued each ESP share at 106.995p.

- On 5 June:

UTG closed at 837.0p. At this price their offer valued each ESP share at 105.33p.

ESP closed at 103.2p.

TODAY:

UTG closed at up 1 at 732.0. At this price their offer values each ESP share at 95.88p.

ESP closed down 0.5 at 93.6.

It was announced via the RNS at 2:30 pm yesterday (Thursday) that the Takeover Panel have agreed to extend UTG's put-up-or-shut-up deadline by two weeks from from 5pm today to 5 pm on Thursday 14 August. An extension was number (2) of the possibilities set out in my 29th July comment, below.

UTG's proposal is on the basis of a mix of cash and new UTG shares so the continuing fall in its share price has caused the value of the proposed offer to ESP shareholders to fall well below 106.995p per ESP share which it was worth at UTG's closing price the day before its approach to ESP was announced. Yesterday's UTG closing price of 748.5p was yet another new 52-week low and it means that its proposal now values each ESP share at just 97.365p. Today ESP closed at 96.4p.

According to yesterday's announcement, UTG and ESP remain in positive discussions and ESP requested, and the Takeover Panel granted, the extension to allow more time to complete due diligence and documentation. Whilst there is absolutely no certainty that UTG will make a formal offer, I am now of the view that it's 75% likely that UTG will make one and it will have a bigger cash element, up from the 30p per share of the UTG's proposal, to make up for the fall in its share price. On the strength of this I now rate ESP a buy and I'm thinking of buying some of its shares.

If UTG do make a formal offer, it might come before the new new PUSU deadline.

In a few moments I'm going to add a comment almost identical to this one to London and South East's chatboard for UTG.

In a few moments I'm going to add a comment almost identical to this one to London and South East's chatboard for Unite Group (UTG).

In my comment on 27 July (below) I suggested that UTG might have been working on their due diligence and on the offer documents so that they could announce a formal offer for ESP at the same time as they announce their interim results at 7 am today. There hasn't been a bid announcement and as far as I can see from my brief perusal of the interim results announcement it doesn't say anything about their approach to take over ESP.

UTG's put-up-or-shut-up deadline for their approach to take over ESP is 5 pm this coming Thursday 31 July 2025 so between now and the deadline there's bound to be an announcement. The possibilities are:

- (1) UTG will say that they aren't going to make a formal offer. If they do, they'll be frozen out from making another approach for ESP for six months unless another entity makes an approach or one of the other exemptions applies.

- (2) On request from ESP the Takeover Panel agrees to another extension of the put-up-or-shut-up deadline to allow more time for UTG to complete their due diligence and/or for the formal offer documents to be negotiated.

- (3) UTG and ESP have agreed on the terms of a formal offer which ESP is prepared to recommend to its shareholders.

- (4) UTG and ESP can't agree on terms so UTG is going to go hostile.

The market cpontinues to be taking a negative view on UTG's half-year results and/or on the possible takeover because UTG has hit another 52 week low this morning at 760.5p. A few moments ago:

- UTG were 769.0 to 770.0 with a mid-price of 769.5 which implies a value of 99.255p per ESP share against a value of 106.995p at the close on the day before UTG's approach was announced.

- The spread on ESP was 97.3 to 97.4.

It looks like UTG would have to increase the cash element significantly to make their proposal attractive to ESP.

Do people on this chat board think that UTG will make a formal offer for ESP?

I'm about to add a comment almost identical to this one to London and South East's chatboard for Unite Group (UTG).

UTG's put-up-or-shut-up deadline for their approach to take over Empiric is 5 pm this coming Thursday 31 July 2025. They announce their half-year results this coming Tuesday 29 July 2025 at 7 am.

Not all takeover approaches go to the wire. Recently the annoucement of the agreed takeover for Renold were announced a few days before the bidder's put-up-or-shut-up deadline. Of course at or just before the deadline some predators annnounce that they are not going to pursue the target and pull out. A fairly recent example of this was a few months ago when Montague Private equity announced that they weren't going to make a formal offer for Advanced Medical Solutions (AMS).

Investors and traders in UTG and ESP need to be aware of the possibility that if UTG are keen to get their hands on ESP and if by late tomorrow (Monday) or the small hours of Tuesday morning they have completed their due diligence and the two companies have agreed takeover terms which ESP is prepared to recommend to its shareholders, it's possible that an announcement of a formal takeover offer could be made at the same time as UTG issue their interims at 7 am Tuesday. However, if late on Monday or early on Tuesday due diligence and negotiations concerning the terms of a possible takeover offer are still in progress it's likely that by 5pm on Thursday there'll be an announcement of an extension to the put-up-or-shut-up deadline.

My previous paragraph takes a positive view as to how things might pan out. However, the market seems to be taking a negative view because UTG's closing price of 782p on Friday 25 July (when it hit a 52 week low of 778.5p) implies a value of 100.38p per ESP share against a value of 106.995p at the close on the day before UTG's approach was announced. ESP closed at 98.5p on Friday.

Do people on this chat board think that UTG will make a formal offer for ESP?

Me12345 -

Thank you for your comment at 20:30 yesterday responding to mine of yesterday.

I don't hold Unite or Empiric.

In the last year or so I've made some good profits out of takeover situations (e.g. Aviva for Direct Line, Greencore for Bakkavor and the contested bids from the KKR/Stonepeak consortium and from Primary Health Properties for Assura).

I was thinking of taking a position in Empiric but bearing in mind that once a target company says that it will recommend a proposal to its shareholders and a formal offer is then made the target's share price initially sits at a discount of 4% to 6% to the offer price to reflect the time to completion of the takeover and the risk of it not going all the way to completion, on the current showing it looks like I'd probably make a gain of just 2% to 3% if Empiric does recommend the current Unite proposal unless Unite says it will pay more or a counter-bidder steps in. I'd prefer to make a gain of about 5% if I were to buy in at this stage of a potential bid scenario. Having said that, a profit is still a profit.

My view is that it is unlikely that Unite will walk away.

A lot of questions you want answering I personally hold both shares around £5k Utg and 3k Esp which I have being trading also while we wait.Think we will see a deal and confirmation of one will probably see share price move up which has probably been depressed buy the acceptance level update which I’m not worried about.There is a big private outfit think about same size or bigger than Unite so could enter the fray but not long to find out.Good look

I'm about to add a comment almost identical to this one to London and South East's chatboard for Unite.

On 3 July Unite's put-up-or-shut-up deadline was extended to 5 pm on Thursday 31 July to give them time to conclude their due diligence on Empiric.

Unite's takeover proposal is a mixed cash and share offer for Empiric. It's 30p plus 0.09 new Unite shares for each Empiric share.

Since the announcement, the Unite's share price has been on a downward trend. Last Wednesday 16 July was their lowest close since their approach was announced. It was 789p. That day Empiric closed at 98.2 and the following day, Thursday 17 July, they closed at 97.9p which was their lowest close since the announcement.

Since those lows last week, both companies' share prices have recoverd a bit. Today Empiric closed up 1.02 (1.21%) at 100.2 and Unite closed up 4.5 (0.56%) at 804.5p. This implies a value of 102.405p per Empric share. However, Unite's closing price on 4 June, just before their approach was announced on 5 June, was 855.5 which implied a value of 106.995p per Empiric share.

I have a few questions on which I'd like people on this chatboard to comment:

- (1) Unite's share price needs to recover by 6.34% from today's close if their proposed terms are to again imply a value of 106.995 for each Empiric share. What are the chances of that happening?

- (2) Will Unite have to increase the cash element to get Empiric's board to recommend their proposal to its shareholders and/or to persuade Empiric's shareholders to accept a formal takeover offer?

- (3) Will Unite have to borrow to enable them to finance the cash element of any formal takeover offer?

- (4) If Unite were to increase the cash element to more than 30p per Empiric share, would their balance sheet be able to take the strain of all the additional gearing?

- (5) If Empiric's board don't recommend Unite's proposal, would Unite go hostile?

- (6) What are the chances of another predator (e.g. a US private equity investor) entering the fray with a proposal which is better than the current one from Unite?

Having been in since launch and ESP at one point being my worst hold in my income portfolio I am glad to have just exited with only a small capital loss. For me the risk to hold for the merger for around 3p is to great (unless an increased bid comes which after the retraction I now doubt , If Unity is forced to divest in more than a few cities by the regulators then it will probably walk.)

For me at present their are several higher dividend payers than Unity so wasn't that keen to hold their shares but each person looks at these things differently so as always DYOR and BOL what ever you do.

Do read to-day’s “Clarification Statement” from ESP, and then forget it!

The really telling paragraph is;

“· "On synergies, [Empiric] said that half of Empiric's £15 million of overheads could be easily cut, possibly two-thirds, plus some financial synergies that could come from being a larger size entity" (the "Synergies Statement"); and,

· "Empiric said that the CMA will probably look at six out of the 23 cities where it is present, and eventually some asset disposals might be required" (the "CMA Statement") (together, the "Statements")

What is the right offer price? That is up to you.

Here since 50-60p drop , bought for pension income , gutted if it gets sold ,messes up everything .

Near NTA would be great but unless we get a counter bidder I think around 107 will be our lot, but just looking at the volatility of Unity SP yesterday difficult to pitch a price. I do much prefer full cash you know where you are.

Offer is at a 10.5% discount to Empiric’s EPRA net tangible assets (NTA) of 119.6p at 31 December 2024.

Current board are making progress with the portfolio. I’m also long term here, similar thoughts with better divi’s elsewhere.

See if a better offer comes along…

Here are my ramblings (old folk are allowed them)

I notice the longer term single short position increased slightly and a new player shorting 0.5% of the shares came in since the 29th May approach by Unity. These would seem to be a bet that the merger will NOT take place and the SP will fall as a result???

I originally bought Empiric at launch for my income portfolio but sadly increased my position when interest rates were low and Empiric seemingly offered a near 5% dividend.(realised later this was mostly paid from capital not earned so over the first few years the amount invested was considerably less than the capital raised in the float) In all these years it has been my worst share holding but for some reason I held on. So thankful now to see an SP close to my break even at last but an offer closer to the NAV would have been better! With Unity on a 20% ish discount to their own NAV they may not want to go higher so as to protect their own NAV from dilution.

Not sure yet If I will hold till merger (still looking Unity over) or bail since their are better dividends out there in some good REIT's I also hold. Buying more of them may end up being my preference rather than holding Unity shares.

As always DYOR and BOL

When is the fca going to grow some balls and look at these trades and jail people?

The RNS appeared on the Unite (UTG) feed at 11:15am.