Beam Dental Bidco Launches Off-Market Takeover Bid for Pacific Smiles
PACIFIC SMILES GROUP LIMITED (PSQ) Share Update September 2024 Monday 16th
Beam Dental Bidco Announces Takeover Bid for Pacific Smiles
Beam Dental Bidco Pty Ltd, associated with Genesis Capital, has announced an off-market takeover bid to acquire all ordinary shares of Pacific Smiles Group Limited. The offer includes multiple options for shareholders, providing flexibility and potential value.
Instant Summary:
- Cash Offer of $1.90 per Pacific Smiles share.
- Scrip Offer of 1 Holdco Share per Pacific Smiles share.
- Mixed Offer of 47.5 cents cash and 0.75 Holdco Shares per Pacific Smiles share.
- The Cash Offer Price is a significant premium over historical trading prices.
- No stamp duty or brokerage fees for accepting the Offer.
Offer Details
Beam Dental Bidco Pty Ltd ('Bidco'), an associate of Genesis Capital Manager I Pty Ltd ('Genesis Capital'), has announced its intention to acquire all ordinary shares of Pacific Smiles Group Limited ('Pacific Smiles'). The offer includes three options for shareholders: a Cash Offer of $1.90 per share, a Scrip Offer of 1 Holdco Share per share, or a Mixed Offer of 47.5 cents cash and 0.75 Holdco Shares per share.
The Cash Offer Price represents a substantial premium over the historical trading prices of Pacific Smiles shares, including a 59.0% premium over the undisturbed price, a 73.7% premium over the 5-day VWAP, a 95.1% premium over the 1-month VWAP, and an 82.6% premium over the 3-month VWAP.
Reasons to Accept the Offer
Pacific Smiles shareholders are encouraged to accept the Offer for several reasons. The Cash Offer Price is within the range of values determined to be 'fair' by an independent expert appointed by Pacific Smiles. Additionally, the Cash Offer Price provides certainty of value and eliminates the risks associated with Pacific Smiles' recent management changes and the search for a new CEO and CFO.
Shareholders also have the option to participate in the Scrip Offer or the Mixed Offer, allowing them to retain an indirect investment in Pacific Smiles alongside an experienced healthcare investor. Importantly, there are no stamp duty or brokerage fees payable when accepting the Offer.
Next Steps
The Offer is subject to a 90% minimum acceptance condition, a Pacific Smiles Board recommendation condition, and a customary no prescribed occurrences condition. Shareholders should read the Bidder's Statement in full before deciding whether to accept the Offer.
Jarden Australia Pty Ltd is acting as the financial adviser, and Clifford Chance is acting as the legal adviser to Bidco in relation to the Offer.
The takeover bid by Beam Dental Bidco is likely to have a significant impact on Pacific Smiles' stock price. The Cash Offer Price represents a substantial premium over historical trading prices, which could lead to a positive reaction from investors. The certainty of value provided by the Cash Offer and the elimination of risks associated with recent management changes are likely to be viewed favorably by the market.
Investor Reaction:
Analysts are expected to react positively to the takeover bid, given the substantial premium offered and the certainty of value provided by the Cash Offer. The option for shareholders to retain an indirect investment in Pacific Smiles through the Scrip Offer or the Mixed Offer is also likely to be seen as a positive aspect of the bid.
Conclusion:
Investors should carefully consider the terms of the Offer and the potential benefits of accepting it. The substantial premium offered and the certainty of value provided by the Cash Offer make this an attractive proposition for Pacific Smiles shareholders. Monitoring the developments and the final acceptance conditions will be crucial in making an informed decision.