Australia's APM Human evaluates 'disappointing' takeover bid from largest shareholder (updated)

APM Human Services International

08/04/2024 07:15

* 
      Offer values APM Human at $841 mln
    

        * 
      Shares drop most since Jan 18
    

        * 
      Discount to prior bids seems appropriate - Jefferies 
    

  
 (Recasts, updates with details and background, and adds analyst
reaction)
    By Himanshi Akhand and Rishav Chatterjee
       April 8 (Reuters) - APM Human Services'  APM.AX  top
shareholder, Madison Dearborn Partners, on Monday offered to buy
the 71% of the Australian employment services firm it does not
own for A$910.4 million ($599 million), an offer the company
called 'disappointing'. 
    APM's shares, which have been on a trading halt since March
27, sank about 31% in resumed trade on Monday after the company
also lowered its full-year profit forecast.
    U.S. private equity firm Madison Dearborn offered A$1.40 per
APM share, less than CVC Asia Pacific's A$2 proposal that APM
has rejected and a 14% discount to the stock's last closing
price.
    APM also said it expects its fiscal 2024 net profit after
tax and amortisation of A$95 million to A$105 million, lower
than the A$178.2 million it earned last year.
    The forecast is "another blow to management credibility,"
said brokerage firm Jefferies. 
    "Though management state there are multiple offers on the
sidelines, given the volatile outlook a discount to prior bids
seems appropriate." 
    Madison Dearborn's offer values APM at A$1.28 billion, which
is about half the company's market value of A$3.3 billion when
it went public in November 2021.    
    APM said it is evaluating the offer.
    After it rejected CVC Asia's bid last week, the company said
it had received multiple offers, but has not disclosed any other
bids beyond the one by Madison Dearborn.

    
   ($1 = 1.5200 Australian dollars)

 (Reporting by Himanshi Akhand and Rishav Chatterjee in
Bengaluru; Editing by Kim Coghill and Sherry Jacob-Phillips)
 ((Himanshi.Akhand@thomsonreuters.com;))