Harmony Energy pulls backing for Foresight bid ahead of auction

Mon, 19th May 2025 11:43

(Alliance News) - Harmony Energy Income Trust PLC on Monday said the situation remains "competitive" as it withdrew previous backing for Foresight Group Holdings Ltd's offer before this week's auction.

The London-based investment company that invests in battery energy storage systems in the UK recommended on Monday that shareholders "take no action" at meetings related to the Foresight offer until the auction procedure is complete.

In March, HEIT accepted an 88.0 pence per share offer from Drax PLC, valuing the entire trust at GBP199.9 million.

It was higher than an original bid by Foresight. However, Foresight then trumped this with a GBP209.9 million cash bid worth 92.4 pence per share which Harmony accepted at the time.

HEIT said it has engaged with the panel executive and the two firms to agree an "orderly framework" to resolve the competitive situation, through an auction procedure.

The auction procedure will consist of a maximum of five rounds which will all take place on the evening of May 21. In the first round, either offeror may make an increased bid.

If the auction procedure has not concluded in the first round (which it will if no increased bid is made), there will be up to three further rounds, in which an offeror will be eligible to make a bid only if the other offeror made an increased bid in the immediately preceding round.

If the auction procedure has not concluded after these three further rounds (which it will if no increased bid is made in a round), there will be a fifth and final round, in which both offerors may make an increased bid.

If either offeror makes a "no increase" statement prior to 17:00 BST on May 20, the auction procedure shall not commence.

HEIT said it will recommend an offer to shareholders after the completion of the auction.

Shares in HEIT were up 0.3% at 96.37 pence each in London on Monday morning. Shares in Foresight Group fell 2.0% to 391.00 pence, while Drax was flat at 616.00 pence.

By Michael Hennessey, Alliance News reporter

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