As per the information gathered by Sky News, Fidelity International, which has 10% of the investment in the business, plans to vote against DBAY Advisor’s offer of 110p per share that was suggested last month.
Considered to be a behemoth amongst fund managers, Fidelity International’s objection to the deal is likely to influence the rest of Finsbury Food shareholders.
A small investor, Rockwood Strategic, has denounced the size of the premium that is attached to the offer.
Fidelity Special Situations Fund and Special Values plc’s portfolio manager, Alex Wright, stated in an interview that “DBAY Advisors’ offer to buy Finsbury Food Group at 110p per share undervalues the company, and Fidelity International will not be accepting the bid at this level.”
“To put this offer in perspective, the bid values the company at a mere 11 times forward earnings, which is a very small premium to the 103p price the stock was trading at back in March this year.”
“The company has been excellently managed by the current CEO and CFO through both COVID and recent commodity price rises.”
“With large efficiency and IT investments now complete, strong future cash flow generation should provide a platform for management to continue to add value through additional bolt-on M&A.”
“We continue to back the strategy at this price.”
On Thursday, the share price of Finsbury Food closed just below the offer price, with the company valued at about £140 million.
DBAY refrained from commenting.
- Published By Team Timeswire