TVH and Loxam have been engaged in a bidding war for Lavendon for the past couple of months. With the two parties countering each other’s bids, the offer price has gone up from an initial 205 pence per share to the 270 pence per share offered most recently by Loxam on 18th January.
TVH has now said that it will go no higher than the 261 pence per share that it previously offered, effectively withdrawing from the bidding.
The board of Lavendon said that it unanimously intends to recommend that Lavendon shareholders accept Loxam’s offer. It said that although the board was confident that Lavendon had a strong future as an independent business, “the premium and deliverability within the Loxam offer places value on Lavendon's prospects and provides certainty, in cash, to Lavendon shareholders today as against the inherent uncertainty of the delivery of future value that exists in any business”.
Lavendon chairman John Standen said: "As our recent full year trading update demonstrated, Lavendon is a company in robust health, uniquely positioned across diverse geographic markets, with strong revenue growth, cash flow and ROCE [return on capital employed].
“Loxam has recognised the inherent value in our business and we believe that its all-cash offer provides Lavendon's shareholders with an opportunity to realise significant value at an attractive premium to the pre-offer period share price, whilst securing early delivery of Lavendon's potential against a backdrop of macroeconomic uncertainty. This is why the board of Lavendon are recommending Loxam's offer.
“In reaching its decision, the board of Lavendon has considered in great detail the best interests of all shareholders and the company as a whole. Loxam is the largest equipment rental company in Europe with a strong management team that shares our belief in the strengths of our people and our growth drivers. We are confident that Loxam is the right partner to take Lavendon to the next chapter of its growth story."
Gerard Deprez, president of Loxam said: “Throughout this process, we have reaffirmed our belief on the benefits of combining our strong and complimentary businesses and have been delighted to receive the recommendation of the Lavendon board at each stage. We believe the transaction will anchor Loxam as one of the leading worldwide access equipment rental companies, will reinforce Loxam's leadership in the European equipment rental market and represents a unique opportunity to increase its scale and business profile. We look forward to working with the highly skilled Lavendon team to further build up the combined business.”
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