Essar says no to Ruia buyout bid
Last week, proposals by the Ruia family to take Essar Energy private were advised against by investors. And this morning, it looks like the warnings have been heeded.
India-focused Essar Energy has announced that the possible offer by Essar Global Fund Limited (EGFL) – the Ruias’ investment vehicle – “clearly undervalues” the company.
EGFL is Essar’s 78 per cent shareholder, and had put forward a possible offer price of 70p per ordinary share for those that it doesn’t already own. But, following feedback from stakeholders, Essar has concluded the proposal wouldn’t be in the oil refiner and power generator’s best interest.
The Independent Committee has considered the Proposal and has unanimously concluded that, despite the current operational and Indian macro-economic challenges facing the business, a possible offer price of 70p per ordinary share clearly undervalues the Company and its future prospects.
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There can be no certainty that any firm offer for the Company will be made nor as to the terms on which any firm offer might be made. Further announcements will be made as appropriate.