Pacific Smiles Group Backs NDC Counterproposal Over Genesis Revised Proposal

PSQ (PSQ) Share Update July 2024 Wednesday 31st

Pacific Smiles Group Recommends NDC Counterproposal at $2.05 per Share
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Pacific Smiles Group Limited (ASX: PSQ) has announced its support for a counterproposal from NDC BidCo Pty Ltd (NDC) to acquire all shares at $2.05 per share, deeming it superior to a previous offer from Genesis Capital Manager I Pty Ltd (Genesis Capital).

Instant Summary:

  • NDC counterproposal offers $2.05 per share with no Ticking Fee.
  • Pacific Smiles Board finds NDC's offer superior to Genesis Capital's $1.90 per share proposal.
  • Directors unanimously recommend shareholders vote in favor of the NDC Scheme.
  • Scheme Meeting adjourned to 8 August 2024 to allow shareholders time to consider the NDC offer.
  • Shareholders can change their votes by lodging a new proxy form or voting in person/online.

NDC Counterproposal Details

On 1 August 2024, Pacific Smiles Group Limited (Pacific Smiles) announced that its Board had reviewed and endorsed a counterproposal from NDC BidCo Pty Ltd (NDC) to acquire all shares at $2.05 per share. This new offer, which includes no Ticking Fee and an increased break fee, is considered superior to a previous proposal from Genesis Capital Manager I Pty Ltd (Genesis Capital).


The NDC counterproposal includes a total cash value of $2.05 per share, comprising a Permitted Dividend of $0.07 per share and a Scheme Consideration of $1.98 per share. The Board believes this offer provides a better outcome for shareholders compared to Genesis Capital's offer of $1.90 per share, which allowed for part consideration in scrip.


Board's Recommendation

After careful consideration, the Pacific Smiles Board has determined that the NDC counterproposal is in the best interest of shareholders. The Directors unanimously recommend that all shareholders vote in favor of the Scheme Resolution to approve the NDC Scheme, provided no superior proposal emerges and the Independent Expert does not withdraw or adversely change its conclusion.


Scheme Meeting Adjournment

To ensure shareholders have sufficient time to review the NDC counterproposal, the Scheme Meeting originally scheduled for 1 August 2024 has been adjourned to 8 August 2024 at 11:30am (AEST). The meeting will be held in person at Automic Group, Level 5, 126 Phillip Street, Sydney NSW 2000, and online via a virtual meeting link to be announced.


Voting Instructions

Shareholders who were on the Share Register as of 7:00pm (AEST) on 30 July 2024 are eligible to vote at the adjourned Scheme Meeting. The cut-off time for proxy forms is 11:30am (AEST) on 6 August 2024. Shareholders who have already voted can change their vote by lodging a new proxy form or voting in person/online at the Scheme Meeting. If no changes are desired, no further action is required.

Impact Analysis

The endorsement of NDC's counterproposal at $2.05 per share is likely to positively impact Pacific Smiles' stock, as it offers a higher cash value compared to Genesis Capital's proposal. The removal of the Ticking Fee and increased break fee further enhance the attractiveness of the offer. This move could boost investor confidence and potentially lead to an increase in stock price as shareholders respond to the improved terms.

Investor Reaction:

Analysts are expected to react favorably to the NDC counterproposal, noting the higher cash value and improved terms. The unanimous recommendation from the Board adds credibility to the offer, likely leading to positive sentiment among investors. However, the final outcome will depend on shareholder votes and any potential superior proposals that may emerge.

Conclusion:

Investors should carefully consider the NDC counterproposal and the Board's recommendation to vote in favor of the Scheme Resolution. The adjourned Scheme Meeting on 8 August 2024 provides an opportunity to review all relevant information and make an informed decision. Staying updated on any further developments will be crucial for making the best investment choices.


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