The directors of SIG, the Swiss-headquartered beverage carton and carton/bottle filling equipment manufacturer, have rejected as “inadequate and too low” a CHFr 2.1bn (€1.32bn) / CHFr 325 per share all cash offer for the group from Elopak’s Norwegian parent FERD and British private equity firm CVC Capital Partners.
Following “earlier indications of interest from various parties”, SIG’s board say that, alongside FERD/CVC, they will now give other interested parties an opportunity to “carefully evaluate an acquisition of SIG”.
In launching their proposed takeover on September 25, FERD and CVC said the proposed offer price translated into a multiple of 30 times earnings/share or 16.9 times EBIT, respectively. for SIG’s earnings in the year ended 30 June 2006. SIG’s directors stressed however, in a statement just days later, their belief that the company’s value was “significantly higher than the price indication mentioned by FERD/CVC”. Furthermore, a “successful focussing’ of the group on its core competencies in the past two years and the “very pleasing 2006 half-year results” illustrated that SIG was “achieving a continuing creation of value which will benefit all shareholders”. In addition, SIG’s share value had, they emphasised, risen by over 60% since early 2004.
Arguing that the proposed combination of SIG and Elopak “follows a compelling industrial logic and is the best interest of SIG shareholders, customers employees and other stakeholders”, the joint bidders said the two businesses were “highly complementary, both from a product and a geographic perspective”. A statement said: “The combined group will be present in all key global carton packaging markets, with product offerings across the whole range of beverage and food carton packaging and will offer attractive opportunities for further expansion in high growth, emerging markets.”
FERD ceo and owner Johan H Andresen said SIG and Elopak had been “trying to negotiate a transaction for a considerable time”, adding: “We have repeatedly sought the support of the SIG Board for the proposed transaction and are now directing this proposal to SIG shareholders on the basis of our current knowledge of the company.”