A PRIVATE equity company is in ‘advanced’ talks to buy BCA Marketplace, it has emerged.
BCA confirmed that discussions with TDR Capital were at ‘an advanced stage’, causing shares to rise by around 20 per cent to 235p today.
The deal would value BCA at £1.9bn and TDR would buy it out at a price of 243p a share.
BCA said in statement today: ‘The board has received a proposal from investment funds managed by TDR Capital to acquire the entire issued share capital of BCA at a price of 243 pence per share in cash.’
It says that would value the entire issued share capital of BCA, excluding treasury shares, at approximately £1,906 million and would represent a premium of approximately 25 per cent above BCA’s closing share price of 195p per share yesterday.
If TDR does decide to make a firm offer at the 243p-per-share price, the board of BCA would unanimously recommend that shareholders accept it – which would land BCA Marketplace executive chairman Avril Palmer-Baunack with a £16.5m payout, according to the Daily Mail.
News of the possible deal comes a year after the rejection of a previous approach by another private equity firm, Apax Partners. BCA Marketplace said last May that it had received a ‘preliminary and conditional approach’ from Apax worth 200p per share. However, after ‘careful consideration’, the proposal was rejected and Apax subsequently lost interest in buying it.
Mike Jones, chairman of automotive profitability specialists ASE Global, said: ‘With talks being at an advanced stage, this looks like a credible proposal for BCA.
‘The shares have suffered during recent weeks, falling from over 210p since April as a result of one of their major shareholders, Woodford Investment Management, having to liquidate assets to fund their own requirements.
‘TDR have experience in owning automotive associated services, and a combination with LeasePlan could bring some significant synergies.’
Next Wednesday, BCA expects to announce its preliminary results for the 12 months to March 31, which it says will be in line with management expectations.
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