UK's Intertek set to back $12.7 billion EQT takeover bid after three refusals
Intertek's Response to EQT's Takeover Proposals
Background and Recent Developments
May 13 - Britain's Intertek is likely to recommend a 9.4-billion-pound ($12.72-billion) takeover proposal by Swedish private equity group EQT, the product testing company said on Wednesday, after rejecting three previous bids.
Shares of Intertek rose by nearly 8% to 57.2 pounds in early trading after it also paused a strategic review it had been carrying out.
Details of the EQT Takeover Bid
Deal Size and Market Impact
If agreed, the deal would be the UK's third-largest private equity takeover, according to LSEG data. EQT is being given access to confirmatory due diligence before it decides on whether it wants to confirm its fourth and final proposal.
Previous Bids and Shareholder Pressure
Over the last month, Intertek rebuffed three proposals from EQT on valuation and execution risk grounds. On Wednesday it said the fourth bid was more suitable, after some investors pressed Intertek to engage with EQT.
Board's Statement on the Proposal
"The board of Intertek considers that the financial terms of the final proposal deliver value in cash to Intertek shareholders at a level which it would be minded to recommend to Intertek shareholders," the company said in a statement.
Conditions and Timeline
If the proposal translates into a firm offer by a new deadline of June 11, Intertek said it was likely to recommend it, although it cautioned there was no certainty an offer would be made.
Financial Terms and Strategic Review
Offer Details
Under the latest bid, EQT proposed 60 pounds per Intertek share in cash and a potential 1.1‑pound annual dividend, a 40% premium in total to the stock's closing price on April 15, the day before EQT made its first approach public.
Intertek's Strategic Review
Intertek launched its review a day after it received EQT's first bid in early April, which many analysts had viewed as a defensive move.
Additional Information
EQT did not immediately respond to a request for comment.
($1 = 0.7390 pounds)
(Reporting by Yamini Kalia and Ankita Bora in Bengaluru and Anousha Sakoui in London; Writing by Pushkala Aripaka; Editing by Subhranshu Sahu and Barbara Lewis)
