It was announced in September 2023 that the group’s board had accepted an offer worth £143.3m from Frisbee Bidco, owned by asset management firm DBAY Advisors. Currently, DBAY is the largest shareholder in Finsbury with a 16% holding.
Worth 110p per share, the bid was unanimously approved by the Finsbury board. Speaking at the time, Peter Baker, non-executive chairman of Finsbury, said that the deal “provides shareholders with an accelerated, de-risked opportunity to realise their investment in full and in cash”.
However, Fidelity International and Rockwood Strategic, which hold 10% and 5.4% stakes in Finsbury respectively, have now expressed public concerns about the offer. Speaking to Sky News, Alex Wright, portfolio manager at Fidelity Special Situations Fund and Special Values plc, said that the 110p per share offer was insufficient.
"To put this offer in perspective, the bid values the company at a mere 11 times forward earnings, which is a very small premium to the 103p price the stock was trading at back in March this year,” Wright explained.
"The company has been excellently managed by the current CEO and CFO through both Covid and recent commodity price rises. With large efficiency and IT investments now complete, strong future cashflow generation should provide a platform for management to continue to add value through additional bolt-on M&A. We continue to back the strategy at this price."
Meanwhile, speaking to Citywire earlier this month, Rockwood Strategic lead fund manager Richard Staveley said that the 23% premium was not in keeping with similar deals conducted over the past 20 years and urged fellow shareholders to reject the offer.
It remains to be seen whether Fidelity International and Rockwood Strategic will act further in a bid to prevent the deal from taking place.