An extra 25? has been enough to win over what originally appeared to be a hardcore band of shareholders determined never to allow the biotech Cellestis to fall into German hands.
Two months since commissioning a report that said shares in the tuberculous diagnostic kit maker could be worth up to $11.53 by the end of the decade, the Cellestis Shareholders Action Group now seems to think a $3.80-a-share takeover bid is infinitely better than a $3.55 one.
"It is reasonably certain that, subsequent to a rejection of the scheme of arrangement, the share price of Cellestis would fall somewhat and may take some substantial time before reaching a price equal to this revised offer," said the action group's website yesterday in response to the revised $366 million offer from the German pharmaceutical company, Qiagen.
"Whilst many of us would not be concerned with such share price movements, there are other shareholders who would be significantly disadvantaged by such an event," said the group which is headed by Vic Bula and represents more than 10 per cent of Cellestis's shareholders.
"We could wish that this scheme of arrangement that creates this situation had never happened but it has."
Likewise, the Melbourne portfolio manager, Gavin Ross, who speaks for his clients who hold about 22 per cent of Cellestis, appears to have been adequately softened up by the extra 25?.
Ross, who originally said Cellestis was "potentially another CSL or Cochlear", told CBD yesterday: "It's a win for shareholders because it's a higher price."
"We didn't like the prospect of a $2 price," he said on the risk of the proposed scheme of arrangement being defeated.
SOUND AND FURY
The approval of the Cellestis bid, which now looks likely, will see its chief executive, Tony Radford, and his co-founder, James Rothel, each collect about $46 million by selling their collective 25 per cent stake.
Still, there is a good chance that next month's scheme meeting to approve the bid could be a little rowdier than usual, with Cellestis and even the Vic Bula-headed shareholder action group expected to cop some criticism.
"Most people I think will be stunned at such a turnaround," said one dissenting post on the Cellestis Shareholders Action Group's website yesterday.
FAR AND AWAY
The Michael Hammes-chaired Irish fibre cement company, James Hardie, has continued to make some attempt to accommodate its largely Australian base of shareholders, one year since holding its final shareholder "information meeting" in Sydney.
Hardie's notice of meeting yesterday said the annual get-together would be at 7.30am Dublin time (4.30pm Sydney time).
Shareholders would be asked to approve the granting of up to 769,656 "hybrid restricted stock units" and 719,593 "relative TSR RSUs" to Hardie's chief executive, Louis Gries.
FEW TAKERS
The recent plea by the newly installed chairman of smart meter company Intermoco Limited, John Evans, for shareholders to support a planned one-for-20 share consolidation has been met with a generous dose of scepticism.
"We believe that, with its current price and number of shares, Intermoco is simply 'off the radar screen' of many potential strategic investors," Mr Evans argued in a statement last week.
But there are concerns about the share price and some have already noticed the past links between Evans and Intermoco's 10 per cent shareholder, the chicken takeaway shop mogul, Stephen Copulos.
Evans is a director of the company, Medivac, which in 2008 paid $2.8 million in cash and scrip for a sanitary-wipe company 35 per cent-owned by Copulos.
One Intermoco shareholder to vent some opposition to the share consolidation is the financial adviser, Kiril Ruvinsky, who holds a 2.3 per cent stake.
"There are countless examples of very successful Australian small listed businesses that became very large businesses with billions of shares on issue, and those shares never stopped large investors from investing," he said in a letter to shareholders last Friday.
Ruvinsky noted how he introduced the company to its first institutional shareholder, Macquarie Bank Funds Management. "The fact that we had almost 2 billion shares on issue at the time, did not stop their investment," he said.
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Frequently Asked Questions about this Article…
What is the Cellestis takeover story and what did Qiagen offer?
German pharmaceutical group Qiagen revised its takeover bid for biotech Cellestis to a $366 million offer — about $3.80 per share, up from an earlier $3.55 bid. The higher offer persuaded a number of shareholders and shareholder groups who had been resisting a German takeover.
Why did some shareholders change their position and accept the higher $3.80-a-share offer for Cellestis?
Some shareholders, including a Melbourne portfolio manager representing roughly 22% of holders, called the revised $3.80 offer a win because it was a higher, certain cash price. The Cellestis Shareholders Action Group (which represents more than 10% of holders) also argued that rejecting the scheme could cause the share price to fall and disadvantage some investors.
If the Cellestis scheme of arrangement is rejected, what does the article say could happen to the share price?
The article reports the shareholder action group warning that, after a rejection, Cellestis’ share price would likely fall and could take substantial time to recover to the level of the revised offer, potentially disadvantaging some shareholders.
Who benefits personally if the Cellestis takeover is approved?
If the bid is approved, Cellestis chief executive Tony Radford and co‑founder James Rothel would each receive about $46 million by selling their combined 25% stake under the takeover.
Will the Cellestis scheme meeting be straightforward for investors?
The article suggests the upcoming scheme meeting could be a bit rowdier than normal, with criticism aimed at both Cellestis and the shareholder action group and some dissent among investors despite the higher offer.
What is James Hardie asking shareholders to approve at its meeting?
James Hardie is asking shareholders to approve the grant of up to 769,656 'hybrid restricted stock units' and 719,593 'relative TSR RSUs' to chief executive Louis Gries. The company also scheduled its annual meeting at 7:30am Dublin time (4:30pm Sydney time).
What is the controversy around Intermoco’s proposed one-for-20 share consolidation?
Intermoco’s new chairman John Evans has urged shareholders to support a one-for-20 consolidation to make the company more visible to strategic investors, but the proposal met scepticism. Critics pointed to past links between Evans and a 10% shareholder, Stephen Copulos, and some shareholders argued a consolidation isn’t necessary—citing examples of successful Australian companies that had billions of shares on issue without deterring large investors.
How is Medivac connected to the Intermoco discussion in the article?
The article notes John Evans is a director of Medivac, which in 2008 paid $2.8 million in cash and scrip for a sanitary‑wipe company that was 35% owned by Stephen Copulos, a significant Intermoco shareholder—an historical link highlighted by sceptics of the consolidation.
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