Consultant Mouchel has admitted that it is fighting one or more takeover bids, driven by the recent collapse in its share price.
In a trading statement to the London Stock Exchange, the firm confirmed that preliminary approaches have been made but that it does not believe they reflect the true value of the firm.
It is the second time this year the firm has faced a hostile takeover. In March it finally saw off the advances of VT Group after three months of speculation over the future the consultant. The 12,000-strong VT Group headed by chairman and former Atkins boss Mike Jeffries and chief executive and ex-Balfour Beatty group MD Paul Lester offered 260p per share for Mouchel in December last year.
But recent collapses in its share price have prompted renewed interest. Its shares closed at 56.5p on Friday, down on a year high of 285.25p. As recently as October shares were trading at 150p or more.
“The significant fall in the Group’s share price over the last few weeks - which is indicative of the currently challenging environment but is principally due to the concerns that exist over the successful completion of the re-financing - has resulted in recent approaches to the company which would, if made, result in an offer being made for the company for the purposes of the City Code on Takeovers and Mergers (the “Code”),” it said.
“As a result the company is in an offer period for the purpose of the Code and a further announcement will be made in due course. The Board does not believe that these preliminary approaches reflect the true value of the company.”
The firm also provided an update on its efforts to refinance its bank loans. It said the re-financing of its principal banking facilities was proceeding to plan and that banks remain supportive.
“Understandably our lenders need to confirm the strength of our business and, with our agreement, they have appointed Deloitte to carry out a limited review to assist their due diligence. With the benefit of this review we expect to agree new medium term facilities for the Group by the time of our half year results announcement in March 2011.
“We are not however complacent about this and are therefore simultaneously exploring alternative funding strategies to ensure that we are not constrained in our efforts to restore investor confidence in the fundamentals of Mouchel’s business and in our long term prospects,” it said.
Overall, the firm said its expectations for the year to July 2011 remain unchanged. “We expect the challenging market conditions of the last six months to continue for some time yet, but we also expect to see increasing long-term contract opportunities emerge in the first half of 2011. In the meantime, we continue to win new contracts and maintain great relationships with our clients,” it said.