Genesis Capital Opposes Pacific Smiles' Revised Scheme of Arrangement
PSQ (PSQ) Share Update July 2024 Tuesday 23rd
Genesis Capital to Vote Against Pacific Smiles' Revised Scheme
Pacific Smiles Group Limited (ASX: PSQ) has announced that Genesis Capital Manager I Pty Ltd will vote against the revised scheme of arrangement proposed by NDC BidCo Pty Ltd, despite an increase in the scheme consideration to $1.91 per share.
Instant Summary:
- Pacific Smiles increases scheme consideration to $1.91 per share.
- Genesis Capital holds 19.9% shareholding in Pacific Smiles.
- Genesis Capital to vote against the revised scheme.
- NDC BidCo declares $1.91 as the best and highest offer.
- Pacific Smiles Directors recommend shareholders vote in favor of the scheme.
Background
On 23 July 2024, Pacific Smiles Group Limited (ASX: PSQ) announced an increase in the scheme consideration to $1.91 per share under the proposed scheme of arrangement with NDC BidCo Pty Ltd. This announcement was aimed at providing a better deal for shareholders.
However, Genesis Capital Manager I Pty Ltd, which holds a 19.9% shareholding in Pacific Smiles, has declared that it will vote against the revised scheme. Genesis Capital's decision comes after thorough consideration of the revised terms.
Genesis Capital's Position
Genesis Capital's statement highlighted that despite the increase in the scheme consideration, they are not satisfied with the current terms of the arrangement. They have had ample time to conduct due diligence and submit a competing proposal but have not done so since their non-binding indicative proposal on 19 March 2024.
Pacific Smiles' Response
Pacific Smiles Directors continue to recommend that shareholders vote in favor of the scheme, provided no superior proposal emerges and the Independent Expert does not withdraw or adversely change its conclusion. They emphasize the importance of shareholder votes in determining the scheme's success.
The Directors also note that NDC BidCo has declared the $1.91 per share offer as their best and highest price unless a third party proposes a higher offer or the Pacific Smiles Board recommends a superior proposal.
Next Steps
Shareholders are encouraged to refer to the Scheme Booklet or visit the Pacific Smiles investor website for details on how to vote. The outcome of the vote will determine whether the scheme proceeds as planned.
The opposition from Genesis Capital could create uncertainty among other shareholders and potentially impact the stock price of Pacific Smiles. If the scheme is not approved, Pacific Smiles may need to explore alternative strategies to enhance shareholder value. The Directors' recommendation to vote in favor of the scheme indicates their belief in the proposed arrangement's benefits.
Investor Reaction:
Investor reactions have been mixed. Some shareholders may be swayed by Genesis Capital's significant stake and decision to vote against the scheme, while others may trust the Directors' recommendation and the declared best offer from NDC BidCo.
Conclusion:
As the voting date approaches, investors should closely monitor any new developments or proposals that may arise. The final decision will significantly impact Pacific Smiles' future direction and shareholder value. Investors are encouraged to participate in the vote and stay informed about potential outcomes.