Essar takeover battle rumbles on as board rejects founders’ offer
ESSAR Energy’s independent board committee has accused the majority shareholder of undervaluing the embattled power firm with its takeover offer, and is urging minority stakeholders to reject the bid.
Essar Global Fund (EGF), which is controlled by the firm’s billionaire founders the Ruia brothers, had offered 70p per share for the remaining 22 per cent of the company it does not already own.
“EGF, which is ideally placed to assess the value of Essar Energy and its prospects, itself recognised in November 2013 that the company was worth at least 97p per share,” said Philip Aiken, chairman of the independent committee, on Friday.
FTSE 250-listed Essar would not confirm what value it puts on the company, but it is thought the figure would be closer to 97p than 70p.
In the Sunday Times yesterday, Aiken accused EGF of attempting to avoid new UK takeover rules that come into effect in a few months.
It is understood that EGF refutes such an accusation and indicates that the possibility of such a takeover offer was laid out in the initial public offering prospectus.
Minority shareholder Standard Life blasted EGF’s bid last month.