In a statement issued this morning, the Milton Keynes-based waste management company said that the investment group had yesterday given it a final indication that it would offer 120 pence cash per share in Shanks – valuing the company at around £476.1 million.
In its initial approach, Carlyle approached the company with a potential cash offer of 135 pence per share – valuing Shanks at £535.6 million (see letsrecycle.com story), while the company's two largest shareholders has indicated they would support an offer of 150 pence per share or more – or £595 million in total.
However, in an interim management statement issued at the start of last month, Shanks revealed that it expected its full year trading to be “slightly below” its previous expectations – which it principally attributed to the “exceptionally adverse” weather conditions.
It also alluded to an “uncertain outlook” for 2010 in some markets, and “tough” trading conditions for the waste industry as a whole.
Value
Explaining Shanks' decision not to continue talks with Carlyle, the company's chairman, Adrian Auer, today said that: “Carlyle has failed to offer a price which, in the view of the Board, properly reflects the value of the Group.
“Shanks is a well-managed group with good strategic positioning in the evolving European waste markets and the Board is confident that the Group can deliver attractive growth in shareholder value over the medium term,” he added.
News on Carlyle's earlier interest in Shanks, and of reported interest from other potential suitors in acquiring the company, had led to Shanks share price increasing late last year (see letsrecycle.com story).
However, with today's news, the company's share price had slumped by 13.37% in morning trading, to 104.3 pence per share, at 10.15am.
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