17.01.2020

Boels sweetens its bid for Cramo

Dutch international rental company Boels has increased the value of its takeover bid for Finnish international rental group Cramo, raising the offer price per share from €13.25 to €13.75, an improvement of almost four percent. The new offer values Cramo at €615 million, plus debt of course.

The move follows its announcement last week that holders of only 80 percent of the shares had accepted the offer as of the closing the January 9th closing date - see: Boels extends Cramo offer, causing it to extend the offer period until the end of the month.

The new offer represents a premium of just over 36 percent compared to the closing price of Cramo shares on November 4th, when the takeover bid was announced. Boels says that the new offer is final and that it will not increase it any further. See 'Its Boels for Cramo' - vertikal.net

Speaking of the improved offer chief executive Pierre Boels said: “We continue to have a strong conviction in the strategic combination of Boels and Cramo, and the support for the offer by a vast majority of Cramo's shareholders underscores this. While we believe that our original recommended offer was already an excellent deal for Cramo shareholders, our increased and final offer represents further upside for Cramo shareholders and we look forward to completing the offer on this basis. For those shareholders who have not yet accepted the offer and would like to, we would urge you to do so without delay.”

The deal remains contingent on at least 90 percent of Cramo’s shares being tendered by the end of January.

Vertikal Comment

Boels is typically insisting on the 90 percent threshold in order to allow it to raise a compulsory purchase order for the remaining 10 percent. It looks as though, as of this week, the holders of the remaining 20 percent of shares are proving resistant to persuasion, thus the improved offer at this stage of the process.

Will it be sufficient to get the deal over the line? That remains to be seen, but it is interesting to note that Boels has highlighted the fact that in the case that it changed its mind and waived the 90 percent threshold requirement and went ahead and purchased the 80 odd percent of shares already tendered – the minority holders could see a significant reduction in the value of their holding, given the reduced liquidity of a ‘rump holding’ in what will be a virtually private company.

My guess is that the 90 percent acceptance threshold will be reached before the deadline – but then what do I know?