GDF SUEZ said yesterday it was considering whether to sweeten its £6bn offer to buy out minority shareholders in International Power after the British company rejected its offer for the 30 per cent it does not already own.
The French power company said it was seriously thinking about ditching the bid but was weighing up its options.
Its statement came less than an hour after International Power said an independent committee appointed by its board had rejected the 390p-per-share bid tabled by GDF last week.
“Any decision by the group will be based on a strict disciplined and value-driven approach to earnings, indebtedness and returns,” said GDF Suez.
Shares in both companies edged down after the announcement.
The GDF bid had valued International Power at £19.9bn – only slightly above its market valuation immediately before the offer.
Deutsche Bank analyst Martin Brough predicted GDF will end up paying close to 420p for each of the outstanding shares.
Meanwhile IP investor Robin Geffen of Neptune, who helped scupper the Prudential’s bid for AIA, spoke out against the offer, saying it should “begin with a four rather than a three”.
The International Power committee “unanimously concluded that the indicative proposal of 390p per share undervalues IP”, the company said.
Directors in the company also added that under UK takeover rules, GDF is barred from making an offer without their approval before 3 August. International Power has six power stations in the UK.
GDF took control of IP last year in a deal that saw it take a 70 per cent stake in the FTSE 100 listed company. IP shares have been performing better than GDF’s of late, up by one-third over the past year, as investors have bet on a full buy-out.
International Power’s shares closed at 402.2p yesterday.