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British specialist bank Shawbrook rejects $1-bn takeover offer

07 Mar 2017

1

British specialist bank Shawbrook today rejected a £825-million ($1billion) takeover offer from private equity firms Pollen Street Capital and BC Partners.

Shawbrook said that the offer of 330p per share was too low, but analysts opine that the PE firms could come back with a higher price.

"Taking into account the terms of the revised proposal, the confidence the board has in Shawbrook's strategy and plan and the feedback from Shawbrook's major institutional shareholders, the board has concluded that it is not willing to recommend the consortium's revised proposal," Shawbrook said in a statement.

The bank added that it "remains very confident in Shawbrook's strategy as a publicly listed company... and in the ability of its current management team to deliver its plan, and is clear that its successful delivery and growth trajectory would generate significant shareholder value over the period to 2020".

Both Pollen Street Capital and BC Partners had tabled the takeover offer on Friday through a new company jointly owned by the two firms.

The offer is at a premium of 22 per cent to Shawbrook's closing share price onThursday

Shawbrook said that it had rejected the offer in January from the consortium but continued talks about a revised proposal.

Shawbrook is one of a number of so-called challenger banks in Britain that aim to break into a market dominated by traditional players such as HSBC, Lloyds, Barclays and RBS.

The proposed acquisition comes after Pollen Street Capital in April 2015 floated Shawbrook on the London Stock Exchange at 290p a share, valuing the bank at £725 million.

Shawbrook, which employs 600 people in 10 offices across the UK, is among the so-called challenger banks in the UK that are trying to compete with big players such as HSBC, Lloyds, Barclays and RBS.

Both Pollen Street Capital and BC Partners have until 31 March to make a decision on whether or not to hike the bid.

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