Gardaworld gives G4S two weeks to agree its final £3.7bn takeover bid

Canadian security firm Gardaworld has made a final offer to buy G4S that is almost £700million higher than the earlier proposal that was rejected.

G4S now has a fortnight to accept the new 235p per share takeover offer that values the group at £3.68billion and is 24 per cent larger than Gardaworld’s earlier proposal of around £3billion. 

That bid was derided as ‘unattractive and highly opportunistic’ by the FTSE 250 business, which has also faced a takeover approach from Allied Universal Security Services.

G4S has already rejected a £3billion 190p per share takeover offer from GardaWorld

Majority-owned by private equity firm BC Partners, G4S’s Montreal-based rival has been purchasing companies in the last few years as part of its expansion plans.

To increase the chances of getting its new proposition accepted, Gardaworld has lowered the threshold of shareholder acceptance from 90 per cent to 50 per cent plus one share.

It has also reached agreement on a £770million package with G4S pension trustees and received approval from antitrust authorities in both the USA and European Union.

Shares in G4S climbed 8.5 per cent to 248.4p after it declared it was investigating the latest proposal with legal and financial advisers, though it has ‘strongly advised [shareholders] to take absolutely no action in relation to the Revised Offer.’ 

The group employs over 530,000 people in over 80 countries who provide security services for the oil and gas industry, airports, nuclear facilities, and sports events among other sectors.

In its most recent half-year results, it recorded underlying revenues of £3.35billion and profits of £97million. Yet despite the strong performance, the firm revealed it would not pay an interim dividend due to uncertainty caused by the Covid-19 pandemic.

G4S employs over 530,000 people in dozens of countries that provide services including security for the oil and gas industry, airports, nuclear facilities, sports events

Regardless, G4S bosses said last month that they would start paying a dividend again and painted a bright future for the company, claiming it can reach revenue growth of between 4 per cent and 6 per cent a year if it remains independent.

Gardaworld’s chief executive and founder Stephan Cretier has claimed, however, that G4S’s financial position ‘has been steadily weakened’ by its senior management.

He wrote: ‘Shareholders have a simple choice: remain invested in a company which has consistently failed them and the wider community for so many years, or realise their investment in cash, at a significant and highly attractive premium.

G4S recorded revenues of £3.35billion and profits of £97million in its latest half-year results

‘Despite the excuses, claims, promises and ‘aspirational targets’ advanced during the course of the bid defence, the stark fact is that G4S is ex-growth and faces serious challenges. The real numbers are completely at odds with the rhetoric.’

He added: ‘G4S needs an owner-operator that understands the people-orientated nature of the sector with the resources, time and expertise to solve the many challenges faced by the business.’

As part of its plan for the company, Gardaworld has said it is committed to keeping G4S’s operational employee numbers at current levels ‘unless and until existing customer contracts change.’

It also stated it would observe its existing UK public sector contracts and make Britain the main base for all UK and European care and justice affairs and its non-North American cash solutions business.

This post first appeared on Dailymail.co.uk