Ontex/PAI: due diligence turned up 'no surprises' before deal talks collapsed
12 SEP 2018
PAI Partners’ due diligence in its proposed takeover of Ontex [EPA:ONTEX] unearthed no surprises, a source close to the deal and a person familiar with the situation told this news service.
Ontex’s performance was already adequately priced by the market, the source said. Diligence showed what could have been broadly expected prior to engagement, the person added. This may have prompted PAI’s interest to cool over the course of talks, the source argued.
On 6 July, Ontex announced it had rejected an offer of an undisclosed value from PAI. PAI returned on 9 July with a statement that it had made a EUR 27.5/share revised bid; Ontex did not accept this offer but opened its books for PAI. On 3 September, Ontex said it would no longer engage with PAI after the latter returned after two months of due diligence with an offer below EUR 27.5/share.
The two parties conducted talks in good faith, the source said, but no formal offer was made.
PAI’s last offer was not a fixed price but a range of what it might be willing to pay, the source said. The entire range fell below EUR 27.5/share, he said.
Ontex shares closed yesterday (11 September) at EUR 18.75.
Asked whether another bidder could emerge for Ontex, the source said only that no other approaches have been so advanced that Ontex has been forced to put out a statement. CVC Capital Partners and Bridgepoint have both looked at Ontex, this news service previously (1 August) reported.
PAI and Ontex declined to comment.