(Bloomberg) — G4S Plc sought to counter a $3.7 billion hostile approach from private equity-backed GardaWorld, urging shareholders to stay on board as the security company is at a “critical inflexion point.”
The timing of the proposal is highly opportunistic and the offer from Garda, which is controlled by BC Partners, is not in the best interest of shareholders, London-based G4S said in a statement on Tuesday.
The Montreal-based suitor is heaping pressure on G4S management just as the U.K. company seeks to regroup following the worst of the Covid-19 pandemic. G4S is poised for growth after shoring up finances with the sale of a cash-handling unit, improving the contract portfolio and cutting costs, the company said. The takeover proposal doesn’t reflect G4S’s commercial and financial prospects, it added.
Garda responded that G4S has taken too long to only be at an inflexion point in its turnaround plan.
“What have they been doing all this time? This is desperately disappointing stuff,” the Canadian group said in a statement.
The stock fell 1.2% to 180.30 pence by 1:14 p.m. in London. It jumped 25% on Monday, when Garda announced it had tabled an all-cash offer of 190 pence a share.
A combination would create a global security firm with more than 600,000 employees. The two firms provide guards to everything from airports to prisons and have operations around the world.
Garda’s latest offer was its third unsolicited approach for G4S since June 15, according to the U.K. firm, and follows an aborted move by the Canadian company last year.
The deal would be financed by BC Partners, which owns a 51% stake in Garda. The rest of the group is owned by Chief Executive Officer Stephan Cretier and other management.
(Updates with Garda comment from fourth paragraph.)
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