Wincanton squeezes higher offer from buyer Ceva amid bidding war rumours
Trucking firm Wincanton has today announced it has squeezed a higher price out of the French giant Ceva Logistics, which made an offer for its UK-based peer back in January.
Under the terms of the “increased and final offer” Wincanton’s shareholders will receive 480p per share in cash. The offer is an increase of 6.7 per cent over the original offer of 450p per share and values the whole group at £803m on an enterprise value basis.
Shortly after the news was published, Sky’s Mark Kleinman reported GXO Logistics, the US owner of Britain’s Clipper Logistics, was considering a higher offer for the business.
Wincanton later revealed GXO has indicated it is considering making a proposal for a cash offer, but has not yet put forward any concrete proposals.
Ceva first went public with its intention to buy Wincanton in mid-January, when the group issued its first offer. Despite coming in at a 52 per cent premium to Wincanton’s pre-offer share price, the initial deal valued the London-listed firm at an earnings before interest, taxes, depreciation, and amortisation (EBITDA) multiple of 6.8 times – well below the market average.
Wincanton’s low valuation, and the market’s failure to realise the opportunity, were reflected in management’s comments at the time of the initial offer.
On 19th January, Wincanton chairman Sir Martin Read said: “While we remain confident in the long-term prospects of Wincanton and the wider sector, we recognise that the strong performance of the company has not been reflected in the performance of its shares in recent years.
“We therefore believe this offer represents the best opportunity for shareholders to realise the value of their investment with greater certainty.”
Wincanton was advised by HSBC as to the financial terms of the increased and final offer and management believes the higher price to be “fair and reasonable.” As such, the company’s board of directors “recommend unanimously that Wincanton shareholders vote in favour” of the deal.