AHG backs AP’s improved takeover bid

Automotive Holdings Group’s $2.3 billion takeover from rival AP Eagers is set to go through, after AHG urged its shareholders to accept a revised offer from AP.

AP Eagers, which is AHG’s largest shareholder, agreed to improve its all-scrip offer to acquire the ordinary shares in AHG it does not already own.

AP Eagers is now offering one share for every 3.6 AHG shares, instead of one for 3.8 AHG shares it proposed early last month.

The two companies have entered an implementation deed.

Last week, AP Eagers said its takeover bid secured the provisional backing of 51.35 per cent of AHG’s shareholders, despite the board advising no action on the offer just a week prior.

AHG chairman Richard England said the improved offer was in the best interests of shareholders, in the absence of a superior proposal. 

“The improved offer provides AHG shareholders with the opportunity to continue their exposure to any future growth in AHG’s earnings and value, and if sufficient AHG shareholders accept the improved offer, the financial and strategic benefits that are expected to accrue to the merged group,” he said.

The closing date of the improved offer remains at September 16. 

Shares in AHG were flat at $2.40 at 1pmAEST.