UK private security group G4S has today urged shareholders to accept Allied Universal's £3.8 billion final offer after the end of the US bidder's drawn-out takeover battle with Canada's GardaWorld.
Hostile bidder GardaWorld had called a halt to the contest yesterday by telling the UK's Takeover Panel it would not increase its December bid of 235 pence per share for the world's largest private security company.
Allied said today it would not increase the 245 pence per share offer it announced on December 8, making it the final bid.
G4S had backed that offer last year after repeatedly rejecting GardaWorld's hostile advances, but low shareholder acceptance forced repeated extensions to offer deadlines.
"G4S directors unanimously recommend that G4S shareholders accept the final Allied Universal offer," the London-listed company said.
Allied today extended its offer deadline to March 16 and the acceptance condition was lowered to 75% from 90% in nominal value and voting rights.
It has largely obtained the required antitrust regulatory approvals in the US and European Union, Allied Universal added, though Britain has yet to approve the deal.
"The biggest issue now is probably the pension deficit in the UK, which has constricted M&A deals in the recent past involving G4S UK businesses," said Morningstar analyst Michael Field.
G4S last year sold most of its cash-handling business to rival Brinks but held on to the UK operations with attached pension obligations.
In its offer document, Allied said it planned to evaluate the possibility of exiting the prison business, where G4S has faced problems in the past, and some other markets, such as Iraq, Afghanistan, Sudan and Uganda.
"Allied will have to work with the pension trustees to come to an arrangement if it wishes to divest anything here (in the UK)," Field added.
The UK security contractor employs security guards in offices, government agencies and financial institutions and provides security camera installations and metal scanners in airports.
