Australian company Bapcor is digging in over its hostile $3.60-per-share bid for Hellaby Holdings, saying it will not pay an additional 18c dividend to shareholders.
Bapcor’s chief executive, Darryl Abotomey, claimed Hellaby’s repeated request for an additional 18c was an "overreach in their guidance" to shareholders, noting Hellaby’s net debt stood at about $83.5million, which Bapcor would have to take on.
"Unfortunately, Hellaby independent directors’ unrealistic views on what Hellaby shares are worth continues to mean that they overreach in their guidance to shareholders," Mr Abotomey said in a statement.
Bapcor wants 100% of Hellaby, namely for its auto-parts distribution division around the country. By already securing "lock-in agreements" with institutional investors it is already holding 40% of the company, with an option to take just a controlling 50.1% stake as an alternative.
This week Bapcor upped its offer from $3.30 to $3.60, a total $351.8 million, but remains adamant it will not pay the 18c dividend.
Mr Abotomey said Hellaby’s net debt was unchanged from June to September at about $83.5million, despite contributions from underlying trading and cash proceeds from selling an equipment business.
"They’ve already spent the proceeds.
"Any dividend paid by Hellaby would effectively be funded by Bapcor, if the takeover is successful, as Bapcor would take on Hellaby’s net debt," he said.
