Wincanton has approached TDG with an indicative cash offer worth 281.25 pence per share, 15% higher than the offer by hedge fund management firm Laxey Partners in February. The European logistics company also says its offer is 22% higher than TDG's closing share price on 8 May and it believes the bid will be attractive to shareholders. Wincanton adds that it has undertaken preliminary due diligence since its approach on 14 April, and that this supports the view that it should continue exploring
a combination of the two businesses.
A statement from the company says: "Wincanton also believes there may be attractive opportunities to generate significant profit improvement through both cost-driven synergies and operational efficiencies and to create value through improved utilisation of the combined property portfolio. A formal offer would be subject to the recommendation of the board of TDG and support from TDG's major shareholders."
The uncertainty over TDG's ownership has affected the number of customers placing orders, according to chairman Charles Mackay. Announcing the group's interim management statement, Mackay says the situation has also constrained its ability to make earnings-enhancing acquisitions. Responding to both offers, Mackay says it will "seek to agree with Laxey Partners, Wincanton and the takeover panel a formal timetable in which each party must either announce a firm intention to make an offer for TDG or announce that it does not intend to make
an offer".
Transport Intelligence chief analyst John Manners-Bell says it is surprising that Wincanton had not made an offer earlier give the consolidation that has already occurred in the industry. He adds: "There are good synergistic reasons why the acquisition of TDG by Wincanton would work. The resulting group would be very UK-centric, but given that most contracts are awarded on a national rather than European basis, this is more a strength than a weakness. This can also be seen as a defensive move, following Norbert Dentressangle's acquisition of Christian Salvesen last year."
Reed Business Information Limited.©2008
