Severn Trent Rejects Increased US$8.2 Billion Takeover Bid
Severn Trent, a British water firm rejected the increased US$8.2 billion takeover deal giving suitors a deadline for a final offer.
On Friday, the LongRiver consortium made a 2200 pence per share for the water utility company. The LongRiver consortium is composed of Kuwaiti sovereign wealth fund, Borealis Infrastructure, Britain's Universities Superannuation Scheme and a part of Canada's pension funds.
After the stock market closed late Friday, Severn Trent rejected the offer. The company stated that the proposal failed to indicate the long-term value and the future potential of the firm. Severn Trent holds 7.7 million clients that are mainly from western and central Wales and England.
Said proposal was already the third after an earlier deal made by the consortium was rejected on June 3. The offer then was at 2125 pence per share bid.
Last month, investors said that they consider selling for more than 2300 pence per share. On the other hand, top 20 investors stated last Friday that the 2200 pence per share was very fair.
According to the takeover rules in UK, the consortium has until June 11 to make a formal proposal for said water firm hence walk away.
The Sunday Times reported that the consortium was weighing options to make another offer on Monday. Meanwhile, Sunday Telegraph reported that frustrated consortium was at the brink of giving up given the speed of rejection on Friday.
LongRiver Partners could not be reached for a statement on Sunday.
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