Show us the money, say G4S investors

Canadians told to raise offer for troubled firm

THE battle for G4s heated up yesterday as its two biggest shareholders spurned a £3bn hostile takeover bid from a canadian rival – but stressed they are open to a deal at a ‘fair price’.

Fund manager schroders said it agreed with the security giant’s board that the 190p a share offer from Garda World ‘significantly undervalues’ the scandal-prone company.

The same offer was unanimously rejected by the G4s board just over a fortnight ago. But schroders, with a 10.49pc stake, offered hope to Garda World by making it clear it is willing to engage in talks and is open to a takeover if it increases its bid. G4s has appealed to shareholders to ‘take absolutely no action in relation to the unattractive and opportunistic offer’.

But sue Noffke, schroders’ head of UK equities, said: ‘As the largest shareholder in G4s, schroders agrees with the G4s board that the 190p bid from Garda World significantly undervalues the company and its prospects.

‘However, we are prepared to engage and are open to a deal at a fair price for that more fully reflects peer multiples, synergies and other strategic benefits for an acquirer.’

The other top ten investors include chicago-based investment firm Harris Associates, which has a 10.04pc sake, and Mondrian Investment Partners with a 5.07pc stake.

David Herro, of Harris Associates, said Garda World’s bid ‘does not come close to closing the gap between their offer and our measurement of intrinsic value for G4s’.

But he added: ‘We would be open to a higher bid’.

Garda World is contacting shareholders directly in an attempt to win them over. It needs to secure a 90pc vote among investors to seal the deal. yesterday, the canadian firm launched another attack on G4s in an attempt to persuade shareholders to accept the offer on the table. The Montreal-based firm’s boss stephan cretier claimed he would ‘educate’ shareholders on how best to manage G4s. And he dismissed protests from the company’s management that it is back on track following a series of scandals, that date back to the 2012 london olympics when the army had to be drafted in after it failed to provide enough security guards. When the hostile takeover bid was announced on Wednesday shares jumped above £2 for the first time since February. They edged up again yesterday, rising 0.8pc, and are up almost 40pc since news of the £3bn takeover bid emerged just over two weeks ago.

G4s declined to comment.