Private equity offers are not very successful in Australia, nor are some of their investments, as the collapse of retailer, Colorado Group and Borders and Angus & Robertson show.
The move on Spotless (next story) will need to see a lift in the offer price if it is to have a chance of success, judging by the failure yesterday of the $303 million bid from a US group and Macquarie Bank for Redflex Holdings.
Carlyle Group and Macquarie Group hopes of taking control of Redflex Holdings, the red-light and speed camera group, failed because of rejection at a shareholders meeting yesterday in Melbourne.
Shareholders met to consider a scheme of arrangement takeover offer from Carlyle and Macquarie which needed a minimum of 75% of voting shareholders to support it.
Media reports said the failure became an even bigger debacle when Computershare’s electronic voting system apparently mis-recorded the results of a key vote.
The situation wasn’t sorted out to around 6.24 pm yesterday when the meeting was over and done with in the morning, hours before.
Redflex’s former chairman Chris Cooper and his supporters ended the merger when their votes were enough to stop an amendment to the Macquarie/Carlyle offer that would have lifted the payout to shareholders to $2.75 a share.
The vote for approving the increased offer was only 63.4% in favour, instead of the required 75%, but interestingly, the vote on the primary resolution later fell to only 59.9% in favour and 40.1%.
So the opposition was substantial.
That is a comprehensive rebuff of Macquarie and its US mate.
Carlyle and Macquarie last Friday increased their offer for Redflex to a minimum price of $2.75 a share, up from the original offer of $2.70 that was conditional on the Australian dollar remaining between 98 USc and $US1.02.
Interests associated with Redflex’s former chairman Chris Cooper hold 11.1% of the company.
His continuing opposition to the offer, which he said undervalued Redflex, sank the offer as he successfully out-thought and out-manoevured the Macquarie camp.
That was sweet revenge for Mr Copper after some shareholders forced him from the board last year.
Carlyle Group and Macquarie are the two largest shareholders with 12% stakes.
Redflex last traded at $2.61.
They were worth $1.535 before the company announced 11 months ago, in June 2010, that it had received an informal, non-binding takeover approach from Macquarie at $2.50 a share.
In February, Redflex’s board revealed and urged the company’s shareholders to accept the $2.70 a share joint bid by Macquarie and Carlyle.
Macquarie and its US partner tried to over-finesse the offer’s value and paid the price.
