Online value retail and education business Findel says a takeover bid from UK sportswear retailer Sports Direct is “highly opportunistic and significantly undervalues” the company.
Findel today (27 March) urged its shareholders to take no action and reject the mandatory offer made by retail tycoon Mike Ashley’s Sport Direct earlier this month of 161p per share.
Findel outlined a number of reasons why shareholders should reject the offer, including a “number of potentially adverse consequences” should Sports Direct take control of the business, including an 8.8% dilution in the value of shareholdings.
“Sports Direct’s offer provides no compelling reason as to why 161p per share represents a fair price, especially given the operational and financial progress made in transforming the group into a market-leading online value retailer,” says Findel chairman Ian Burke.
“As stated in its offer document, Sports Direct endorses the strategic plans that the Findel Board is implementing, and is supportive of the Findel leadership team delivering these. It is against this backdrop that the board is unanimous in its recommendation that shareholders reject the offer and take no action.”
Separately, Sports Direct International Plc is continuing to pursue struggling British department store chain Debenhams, saying it is considering a “possible” offer of GBP61.4m (US$81.1m) to take full control of the retailer.