Spotless Group Holdings Ltd Downer’s takeover offer for Spotless
Downer’s takeover offer for Spotless: Spotless Group Holdings Ltd (ASX: SPO) stock made an outstanding rally on March 21, 2017 and surged over 48.96%. Downer EDI Limited (ASX: DOW) made an unsolicited conditional offer regarding all the issued share capital of SPO and has an interest of about 19.9% in the group. Moreover, the conditional takeover offer for Spotless has been made at $1.15 per share. However, the group reported that this offer is highly conditional, and is linked to factors including a minimum acceptance of 90% and SPO meeting its earnings guidance. This update from the group boosted the shareholders’ sentiment leading to a solid rally. In fact, the management reiterated that their earnings guidance would be maintained as issued in February 2017. The group built a solid chip customer base and a strong portfolio of long term Government, Health, Defense and PPP contracts as well as operating the largest commercial laundry business in Australia and New Zealand. Accordingly, the management reported that they would assess any proposal in the context of their announced strategy reset, including the recently announced contract portfolio restructure, which is expected to be a material driver of growth and enhanced future performance.SPO has advised the shareholders to take no action in respect of the offer till the offer is evaluated in detail.
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