PCH seeks legal advice on new Cape offer

Malaga-based scaffolding and form-work supplier PCH Group Ltd is awaiting legal advice after UK-based Cape plc announced its intention to launch a $233 million offer despite having a standstill agreement with PCH.

Cape yesterday announced it would make its offer, of $1.30 per share, direct to shareholders after the PCH board recommended against acceptance of the proposal, saying it was undervalued.

PCH's decision to reject the offer activated a standstill agreement between the two companies, being designed to prevent Cape making a hostile takeover bid for one year.

Cape said yesterday its offer was subject PCH's board waiving the agreement, with Cape Australia chief executive Martin May telling WA Business News yesterday that he hoped the proposal would influence PCH into reviewing their decision.

In an announcement to the Australian Securities Exchange today, PCH said it was considering its response to Cape's announcement and recommended its shareholders take no action in the interim.

The full text of a PCH announcement is pasted below

The board of PCH notes the announcement made by Cape PLC to the AIM market in London earlier today that Cape intends to make an unsolicited takeover offer for all the shares in PCH at $1.30 cash per share. A copy of that announcement is attached.

The board of PCH is considering its response to the Cape announcement and pending further advice from the board, PCH shareholders are advised to take no action in relation to the Cape announcement.

The board of PCH notes that it is awaiting final legal advice on the apparent breach by Cape of a standstill agreement between PCH and Cape.

Gresham Partners is continuing to advise PCH in relation to this matter.