Intertek primed to reject EQT’s latest £10bn takeover bid
FTSE 100 testing company said two previous bids by Swedish private equity group had undervalued its business
FTSE 100 testing company Intertek is gearing up to reject EQT’s latest takeover offer, after the Swedish private equity group this week raised its bid in pursuit of a deal.
Intertek considers that EQT’s sweetened £58-per-share offer lodged on Tuesday still undervalues the company, said people familiar with the matter. While the board is likely to reject the bid as early as this week, no final decision has been made.
EQT’s latest offer is closer to a price that would be acceptable for Intertek, the people added, raising the possibility that the UK testing and inspection company could be acquired in a more than £10bn deal if the buyout group sweetens its offer again.
Intertek and EQT declined to comment.
Intertek previously rejected EQT’s bids of £51.50 and £54 per share last month, saying they “fundamentally” undervalued the group.
This week EQT submitted its third £58 per share indicative proposal, equivalent to an equity value of £8.9bn or £10.3bn including debt.
EQT said it “has submitted this significantly higher [proposal] with a view to securing prompt and constructive engagement from the board of Intertek and progressing swiftly towards a transaction”.
Intertek on Tuesday said it would review the latest proposal and respond in “due course”.
The new offer represents a 54 per cent premium to Intertek’s closing price of £37.70 on April 9, the day before EQT put in its first proposal.
Shares in Intertek closed up slightly at £51.06 on Wednesday, well below the Swedish group’s latest offer.
EQT submitted its first nonbinding takeover offer for Intertek on April 10, which the testing company rejected. Intertek within days announced plans for a strategic review to explore separating out its energy and infrastructure business, either through a sale or demerger.
Matt Peltz, the son of activist investor Nelson Peltz, has built a stake in Intertek and has pushed for a potential break-up, the FT reported last month.
Under UK takeover regulations, EQT has until May 14 to make a firm offer or walk away.