UK card operator and payments processor Retail Decisions has agreed to a £168 million ($316.9 million; €248 million) cash takeover bid from European private equity firm Palamon Capital Partners.
Under the takeover deal shareholders in Retail Decisons will receive 205 pence per share in cash, which is a 30% premium to the vendor’s closing share price last Wednesday, the day before the company said it was in advanced takeover talks.
Last Thursday the news of a possible offer sent the company’s stock soaring and by the end of the day its shares stood at 193.5 pence, up 36.25 pence.
Retail Decision’s independent directors, advised by Lazard and Oriel Securities, have said the terms of the proposals are fair and reasonable.
Palamon has received undertakings to accept the offer from shareholders representing 25.29 percent of Retail Decisions’ share capital. The bid proposals will be put to shareholders at an extraordinary general meeting in mid-November.
Matthew Turner, a partner at Palamon, led the deal with Fabio Giuseppetti. He said the response from shareholders, who had not already irrevocably backed the deal, had been positive.
He said Palamon’s plan was to grow the business: “It has been through significant transition in public hands. It was originally a penny stock with about 15,000 shareholders, now there are 11,000 or so. It is difficult for management to do anything quickly that needed their approval.”
He said it was one of the reasons management had been receptive to an approach from private equity, which led to the Lazard-run auction. Under Palamon’s ownership, management would look to grow the core card-issuing business organically and through acquisition, Turner said.
Palamon closed its latest fund above target on €670 million in July this year.