The board of ISG has unanimously rejected the increased takeover offer from Cathexis
ISG鈥檚 board has unanimously rejected US investor Cathexis鈥� increased takeover offer, stating it 鈥渃ontinues to undervalue ISG and its future prospects鈥�.
The board said it had, with its advisers, 鈥渃arefully considered鈥� the raised offer of 拢1.71 made yesterday (3 February) before deciding to reject it.
Cathexis had upped its offer by 20% to 拢85m, up from 拢71m. The US investor has said the increased offer is final and will not be raised further.
In its rejection ISG said it had taken into account recent issues in its UK construction business and the time it could take for the firm to fully deliver on its turnaround plans. But the board said it 鈥渞emains confident鈥� that, alongside improving trading in its core fit-out businesses, it can provide 鈥済reater value for shareholders than the offer鈥�.
The board also said it has 鈥渢aken into account鈥� the fact Cathexis has amassed more than 33% of ISG shares, and the potential impact of such a significant shareholding should its offer be unsuccessful. Cathexis needs 50% ownership or support to seal the deal.
ISG鈥檚 board added that it will be writing to shareholders with its formal response to the offer shortly to explain why it has reached this conclusion and 鈥渟trongly advises鈥� them to take no action and, in particular, not to sell their ISG shares.
Shareholders have until 17 February to respond to the increased offer.
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