Melrose seeks access to Charter's books for raising offer
26 July 2011
Manufacturing buyout firm Melrose Plc yesterday said that it would be willing to raise its offer for Charter International if it was given access to the embattled Irish welding equipment manufacturer's books.
London-listed Charter has so far rejected two offers from Melrose, the most recent of which valued it at £1.4 billion, saying that the takeover proposal was ''opportunistic and substantially undervalues the company and its prospects.''
Last month, Charter, which currently has a market cap of £1.32 billion, rejected a 780 pence a share or £1.3 billion bid from Melrose, and later rejected a sweetened 840 pence a share or £1.4 billion offer.
Melrose, advised by NM Rothschild, yesterday said that it was "willing to consider increasing its proposal to reflect any information which demonstrates it has materially undervalued Charter and justifies such an increase."
"Melrose does not consider that it would be appropriate to proceed without access to satisfactory diligence and will not do so," the industrial turnaround firm said in a statement.
Melrose also added that it would consider raising its offer without due diligence only if Charter received a competing offer.
Charter's chairman Lars Emilson yesterday told The Daily Telegraph that the company would not open its books at an offer of 840p a share despite Melrose saying that it would be willing to raise its offer if it were allowed to do due diligence.