Submitted by Atrue Freeman
How is the bid by SLU Beverages Limited to takeover Banks Holdings Limited (BHL) likely to playout?
History of similar events suggests that BHL’s directors will have a significant, possibly the most significant, influence on the outcome […]in relation to BHL’s small shareholders.
It may be worthwhile to explore how the directors of BHL are likely to perform vis a vis the performance of the directors of Light & Power Holdings Ltd. when Emera Inc. launched its bid to takeover LPH.
My recollection of the endgame in Emera’s takeover of LPH is that the LPH directors commissioned and received a valuation of approximately $25+ to $32+ per LPH share and recommended that shareholders accept the lower end of the valuation of $25+. This notwithstanding that LPH’s main business was the provision of an essential service (electricity) and that LPH was a monopoly (only entity providing the essential service that it did). It certainly appeared that there was a strong case for the directors to recommend to the shareholders that a price nearer to the upper end of the valuation be sought, even if it meant soliciting an alternative bid.
Would BHL be a good fit for Goddard Enterprises Ltd. and would GEL respond favourably to an invitation to bid, even a stock for stock bid, for BHL?
The below link describes the opposition to SLU Beverages Ltd.’s acquisition of its initial equity interest in Banks Holdings Limited at $4 per share in 2010, the same price being offered in 2015 in an attempt to takeover BHL. But this issue has a wider reach. Sagicor Financial Corporation owns around 6+% in BHL. While a minority shareholder, SFC has the ability to be heard on this matter and the responsibility to defend its investments on behalf of its many shareholders.