G4S stepped up its defence against the “opportunistic” and “very highly leveraged” GardaWorld in the latest salvo of the hostile takeover battle for the FTSE 250 security firm.
Its board urged shareholders to reject GardaWorld’s 190p per share bid again after the Canadian rival made a firm offer to investors on Saturday. It claimed the £3bn offer “significantly undervalues” the “fundamentally re-positioned” company and attacked GardaWorld's debt pile.
“We believe that GardaWorld needs G4S in order to realise its aspirations,” the board of G4S told investors in response to the offer document.
It added: “GardaWorld is a very highly leveraged business that has grown through a string of acquisitions and which has incurred net losses of C$940 million over the past three years.”
GardaWorld has given shareholders until Nov 7 to accept its 190p per share offer for G4S. The response from the security outsourcer was just the latest shot in a war of words between the two companies.
The Canadian firm used its offer document to launch another attack on G4S over the weekend, arguing that it needs a “deep root and branch reprogramming”. Stephan Cretier, chief executive of GardaWorld, said “a cookie-cutter approach will not succeed in fixing G4S’s operations”.
In response to G4S’s latest defence, a GardaWorld spokesperson added: “If G4S has been 'fundamentally repositioned', how is it that revenues are decreasing, margins are flat or declining, the dividend has been scrapped and the pension accounting deficit is growing?”
G4S shares were trading at 209p at the end of play last week, a 44pc increase on their levels before GardaWorld revealed its interest. Earlier this month G4S admitted that US rival Allied Universal had also expressed an interest in making a bid.
The offer document revealed advisers will make more than £300m in fees if GardaWorld wins the backing of investors.