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I think 1.05 is reasonable. 1.25p should be accepted. My worry is that if the Board reject anything and everything then the bidder will walk away and the price will crash to 50p. Revolution Bars turned down £2...now 20p. Intu turned down 13 billion pounds and ended up bankrupt. Countrywide...the Board tried to do a silly deal and turn down a bidder. Fortunately the bidder pushed higher.
This is always the issue. Directors often say no because they are on a nice earner and dont want to give that up. Directors here should be negotiating and involving shareholders and walk away if they dont want to..
There has been a number of half baked offers made for companies over the last 6 months where offering companies might make an offer somewhere about a price of , and many never get any further.
If this is the third offer ie 88p then 95p now £1.05p are they just finding out the lay of the land, some make an offer then ask to see the books and have 3 months to conclude.
So will this £1.09 or more become an offer and have they asked to see the books, it's all a bit iffy.
Has the market woken up to the £1.05p offer or might it never happen, and what does the MARS bod's say is a good price?
Marstons is Pedigree the offer of 105 will not brew well with many large holders for sure.
Pmoran, well we all have our boundaries I guess though not sure what yours are, lol. The only reason I mentioned that I am an ethical investor- fully aware not everyone is- is because some posters were discussing the question of acquisitions and assuming that buyouts are always about asset stripping. I don't think they are.
On the situation Marston's are in I must admit I didn't expect such a low ball offer. I agree with the board. It's derisory. For all the reasons they have stated. £1.50 would be a steal. £1.05 is cheeky as hell. Hope they don't get it for that. Bit shocked actually. Hopefully they will up their game. The market seems to have responded with resilience so far.
Tricky - a most admirable stance regards ethical investing but personally I look for growth and dividend from my investments and leave it to someone else to regulate what’s legal or acceptable. I decided many years ago that at least you knew upfront that a bookies sole objective was to take your money off you so what makes Barclays or Lloyd’s more ethical than William hill or Ladbrokes? I am happy to invest in pubs or alcohol producers even though if their product is abused it can cause ill health and even death but I am also happy to invest in tobacco producers whose product if used as directed is pretty much guaranteed to cause I’ll health and even death. I’m not sure if my investments in big pharma is enough to offset my investments in alcohol land tobacco any more than I think my investment in green energy offsets my holding oil and airlines. Even Unilever has had its issues and my investment in associated British food effectively includes the fast fashion retailer primark along with British sugar who to my knowledge are the biggest producer of cannabis in Europe! Trying to find shares that will stand a chance of giving me growth and dividend is hard enough, trying to find one that does it ethically would be a nightmare.
That said I do give to charities, try to be generally a nice person, have no issues with vegans or environmentalists (as long as they aren’t lying in the road stopping me getting where I am going) and like I said admire anyone who can make ethical investing work for them.
If this platinum lot make a formal offer over £1.05 and it’s put to the vote I’m pretty sure I’d be a no. If I’m honest I think the board can get us to £1.00+ fairly rapidly once we are out of lockdown but it’s only once we are out of lockdown that we will feel to true extent of business failures and the associated unemployment and we already know we will need to pay for the govt support/borrowings so it’s possible that there may be additional taxes on alcohol or other taxes that affect the disposable income of our customers. So if they came in at say £1.30 I might be tempted to take my jam today.
Hi All,
To state my position, I would accept £1.05 for my holding because it's a decent premium and I like to bank gains.
Questions for people in the know:
1) Why would Platinum, a P/E firm, buy on the open market if they cannot be guaranteed to own 100% of the issued share capital?
2) What viable options do Platinum have if management refuse to accept their offer given the fragmented nature of the shareholdings as evidence by the 8.3 RNS'?
Thanks all
But it's not yet a firm offer, so that's 3 offers so far I guess they are just trying to find out where we go from here.
OK the board can reject any offer but if the shareholders have their say will they take £1.05?.
Maybe there will be another £1.20 offer within the next few days.
Pint only alf full the bid will go up just hold your nerve.
Looks like the market thinks that they might do that Adeg. Still going up.
I didn't realise that the 8.3 forms were just a declaration of what you already have. Classic lse being slow with the RNS.
Gla.
section 8.3 notices are not new buys they are declaring how much they already own. There will be loads of these over the next few days.
What we need now is for Platinum to make an offer and then start purchasing shares in the market. They can do this if the market price is below their offer price, although why would you sell for less than £1.05 now is beyond me.
Ah well, I spoke too soon! I expected better than that for sure. Never mind. Looks like we all had a bit of a lift so far from the whole episode.
Barclays and Nordes Bank did not buy on friday!
They are merely advising their holdings along with everyone else because the company is in a bid situation. That is what the Form 8.3 is for.
Why wouldn't it go north? Barclays and Nordes Bank are buying 1% and 2.5% of the company shares at 87p on Friday. Jump in now. Mms not letting it go higher than 90p anyway. But when we get the first offer confirmed you will get offered 2p less than that first offer at once from market makers. Very likely to be between £1.25 and 1.50. And then 2p less than a second offer from a new bidder. And so on until they seal a deal. No-one's buying 1 and 2.5% in one go for no reason. James Spader bought in at 1% with what looks like his own money- he also works in mergers and acquisitions. Banks will probably keep buying.
No brainer.
I'm an ethical investor. I don't do oil or weapons and lots of other stuff. I put petrol in my car and I'm not a pacifist but as far as my investments are concerned I think 'do no harm' and ideally do some good. But we don't control the financial markets infrastructure. Takeovers will happen until we restructure- not looking likely is it? Like never. I would be happy with a bit more regulation myself. They won't asset strip the pubs. Marston pubs are making good money (turnover £1.17 billion in 2019 according to Bloomberg and the FT- google it) and with less post pandemic competition they will do even better. Kraft didn't asset strip Cadbury's. Chocolate bars are smaller. No-one died.
Big old buy for a very high short term return.
A US private equity investment firm's takeover bid for pubs and brewing giant Marston's has been rejected by its board on the basis that it "significantly undervalues" the listed company. Two prior bids, submitted in December, have also been revealed.
The move from Platinum Equity Advisors was first outlined on Friday 29 January.
A Marston's statement to the London Stock Exchange said: "The board of Marston's has considered the proposal of 105 pence per Marston's share with its advisers, and unanimously rejected the proposal on the basis that it very significantly undervalues Marston's.
"The proposal followed two earlier proposals at 88 pence and 95 pence per share in December 2020, both of which were received prior to the Brains transaction, and were unanimously rejected by the board.
"The proposal represents a 19 per cent discount to the company's share price at the start of 2020, pre-Covid-19; and since that time the company has completed the transformative joint venture with Carlsberg to create the Carlsberg Marston's Brewing Company, which realised significant value on completion and is anticipated to continue to do so as the benefits of the joint venture are realised.
"In December 2020 the company also announced an agreement to operate 156 high quality pubs within the SA Brain estate in South and West Wales, in a transaction which is expected to be accretive to earnings in the first full year of trading."
Platinum is now required to either announce a firm intention to make an offer for the company or not by 5pm on Friday 26 February.
JP Morgan Cazenove is acting as financial adviser exclusively for Marston's.
RNS £1.05 offer rejected...thought we`d pop to at least that
Going North tut tut
88p
2.5% declared buy from Norges Bank from Friday. Again- they seem to disagree with Liberium's tip to hold. MMs keeping the sp down nice and low for mate's rates. Won't last. The lower your entry point the better your return. Already bought £26k last week but I may as well jump in with some more. Bit daft not to. They are going to buy for well over £2 billion. Marston's turned over £1.17 billion in 2019. They aren't on their knees. This is just the pandemic and the buyers know that as well as Marston's. I think they'll be getting it cheap at £2.5 billion. If they go too low they will just start a bidding war.
And Barclays declare a massive buy today. Lol. Making sure we stay at mate's rates? We are going for a 50-80% rise. Platinum's last buy was for £2.7 billion for a medium sized tech company. James Spader, a partner in a mergers and acquisitions firm bought over 1% on Friday, declared after hours. Wonder if they know something that's staring us in the face. Strong buy. You lths moaning about it ending in tears will double your money. Your only worry is deciding where else to take your money. GLA.
Fairdealer, I like any scenario in which Marstons remains as a brewer, even if only as a partner in the JV. It has always surprised me that the company is still called Marston's, even though John Marston sold out completely in 1888 and there have been several owners of it since. Perhaps the longevity of the name is testament to the quality of the product, and if that's the case it may survive a little longer yet.
I fear however that Carlsberg will be only too happy to buy the remaining 40% of the JV if it becomes available.
Absolutely!
As a Shareholder looking to the long term, I would rather stick with the prospect of an imminent recovery, than being mugged off by Private Equity's latest rendition of a Sale and Leaseback deal. Very rarely do they end well.
VC Groups are looking for value. The price they wish to pay has to fit their investment criteria. VC's rarely keep businesses intact as they see greater value in a break-up.
Here's a scenario, Marstons sell it's property portfolio and retain it's 40% ownership of CMBC. So in name only Marstons would continue. May sound a bit OTT, but cannot see Carlsberg being happy having just completed the JV, unless of course they are in the background!
Whatever as Trustees of Shareholder's interests the BOD have a duty to inform of any offer, which they will either recommend or otherwise to Stockholders.
Good points HarryCaul.
I think the question is 'What can Private Equity offer, that the current BOD cannot'?
The recovery in Business will happen, I suspect sooner rather than later. That recovery will be spectacular. Not just in Hospitality, but across the board.
Pubs, Restaurants will be rammed, and people will have money to spend.
You want a Holiday when we get the all-clear? Can you imagine the scrummage at the major Airports?
So, given that the 'pent up demand' will arrive at some point, the Private Equity crew will in my eyes at least have to pay up to be part of it.
Private Equity though would need to pay the right price, so this will be one hell of an exercise in pricing a Business with minimal sales at this point in time, while being attractive enough to shareholders to jump ship early.
Liberum has downgraded Marston’s to ‘hold’ after takeover speculation pushed the share price higher.
The brewer and pub company is currently considering an unsolicited approach from US private equity firm Platinum Equity Advisors. No further details have been announced by Marston’s, although in accordance with the Takeover Code, Platinum must make a firm offer or walk away by 26 February.
Anna Barnfather, analyst at Liberum, said: "Marston’s shares have risen up to its current pro forma net asset value following confirmation of a bid approach. No firm offer has been made, and hence no specific details have been provided while the board evaluates the proposal.
"Based on a pre-Covid trailing earnings before interest, tax, depreciation and amortisation of around £180m, current NAV of 87p and recent transaction comparatives, we believe an offer could come in at above 100p.
"However, this is dependent on many factors. We move our recommendation to ‘hold’, giving the upside risk balance with uncertainty over whether a final offer can be agreed."
Liberum, which previously had a ‘buy’ rating on the stock, has a target price of 90.0p. As at 0930 GMT, shares in Marston’s were flat at 82.25p.