Telco minnow TeamTalk has rejected Spark’s takeover offer as "predatory", after independent advisers valued its shares at more than twice the offer.
Spark’s hostile offer is 80c per share, or $22.7 million, while independent adviser Grant Samuel valued the shares between $1.52 and $2.11.
Spark wants to take over TeamTalk’s mobile radio services, CityLink fibre services around Wellington and its rural internet provider Farmside, and its 15,000 customers.
TeamTalk’s chief executive Andrew Miller said Spark’s "predatory" offer was made tactically, before TeamTalk and its shareholders could benefit from the turnaround strategy implemented late last year.
"Those challenges have now largely been addressed and TeamTalk is profitable again," Mr Miller said.
However, in response, Spark’s chief financial officer David Chalmers labelled the Grant Samuel evaluation as "patently absurd" given the top end of its range, at $2.11, represented a 369% premium to Team Talk’s last trading price before the takeover started.
TeamTalk shares rose 7% on the rejection notice yesterday, trading up to 85c, which suggested to Craigs Investment Partners broker Peter McIntyre, that "the market was not believing of the valuation" either.
He said while Spark would "probably" consider raising its 80c offer, it would not be into the Grant Samuel valuation range.
He noted TeamTalk had spoken in recent months of being approached by other parties to sell some or all of its business, and of potential partnerships or joint ventures.
