Colt share price jumps after Fidelity makes buyout offer

 
Jessica Morris
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Colt has held back from rejecting the offer (Source: Colt)

Shares in telecoms group Colt jumped 21.6 per cent to 190.5p per share this morning after its majority shareholder Fidelity made a bid to take it private.

The US fund manager, which owns two thirds of Colt, offered to pay 190p for the additional shares, but added that the offer would not be increased.

Read more: Colt slumps as it exits mobile call contracts

Colt's board said the offer undervalued the company and its futures prospects. However, it didn't reject the offer, saying some shareholders could find it acceptable "in some circumstances".

"As founders and majority shareholders of Colt, Fidelity is pleased to announce the continuation of its commitment to the business through returning the group to private ownership," Cyrus Jilla, president of Eight Roads, the proprietary investment arm of Fidelity International Limited, said.

"We typically hold our proprietary investments outside the financial services industry, such as Colt, in the private domain."

Read more: Colt eyeing £100m Japanese data centre acquisition of KVH

"This transaction allows us to hold our investment in Colt consistent with this strategy while providing an attractive and certain value for the current Colt Independent Shareholders."

Colt, which runs fibre-optic networks and data centres for companies, reported full-year adjusted pre-tax profit fell 45.8 percent to €23m (£16.4m) in 2014. This was driven by falling revenue in its voice and IT services divisions.

Read more: Fidelity revolts over executive short-termism

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