Monday 16 November 2020 2:06 pm

G4S seeks to calm investors as rivals circle outsourcer

Takeover target G4S today said that its retail cash solutions (RCS) business could pull in $600m a year in revenue by 2025 as it sought to bolster the case for investors to ignore circling competitors.

The FTSE 250 outsourcer has been the subject of a months-long pursuit by Canadian security firm Gardaworld, which has made multiple offers for the business.

Read more: G4S and Gardaworld trade blows as takeover spat continues

And earlier this month US firm Allied Universal joined the race with a higher bid than Gardaworld, raising the prospect of a bidding war for the firm.

G4S has told shareholders to ignore both offers, saying that they “significantly undervalue” the company.

This morning the board released a prospectus to the market outlining what they called the “exceptional unrecognised value” of the retail cash business.

Currently, the arm makes $170m in revenue a year, but G4S said it was confident that it could grow this figure 25 per a year over the next half-decade.

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“The board of G4S believes that RCS has a unique and highly differentiated offering which is unmatched by competitors”, it said. 

“When compared to software peers, hardware peers or traditional CIT players, competitors have a much narrower competitive offering, focused either on balancing and reconciliation or on logistics.”

Gardaworld hit back at the claims, saying: “More jam tomorrow, more ‘aspirational’ targets. A 24 page presentation about a business that accounts for less than 3 per cent of Group revenues. 

“The attempt to position G4S as some kind of embryonic FinTech ‘disruptor’ is delusional and, frankly, insulting to shareholders. As a shareholder in this business, we are deeply concerned.”

The two sides have been sniping at each other for months, with this morning’s foray just the latest in a number of skirmishes.

Read more: G4S fends off Allied Universal takeover as prospect of bidding war hots up

Last week Gardaworld revealed it had been cleared to go ahead with its pursuit by North American regulators, a fact which was brushed off for G4S.

Shares in the firm remained flat today.

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