Battle Looms over Harvey Nichols Buyout as Largest Minority Shareholder Rejects Poon Offer
Cope, Nigel, The Independent (London, England)
THE PROPOSED pounds 137.5m buyout of Harvey Nichols looked likely to develop into a bruising battle yesterday after the department store retailer's largest independent shareholder said it would reject the deal.
Deutsche Asset Management, which has a 14 per cent blocking stake in the upmarket retailer, said the 250p a share offer undervalued the company. "We should be looking at a price well above 300p a share," the fund manager said.
Invesco Perpetual and Henderson Global Investors also voiced opposition to the buyout, which has been put forward by Dickson Poon, a Hong Kong businessman who owns 50.1 per cent of the shares. Harvey Nichols shares fell 25p to 201.5p on fears the deal would fail.
Mr Poon's buyout vehicle Broadgain said it would not improve the terms of the offer but would consider reconfiguring it as a straight takeover rather than a "scheme of arrangement". A scheme of arrangement needs the backing of 75 per cent of the independent shares. Deutsche Asset can therefore scupper the deal as its shareholding equates to 28 per cent of the minority.
But Mr Poon's advisers said Broadgain might switch to a straight takeover offer, which would enable it to apply to the Financial Services Authority to delist the company if it could secure 75 per cent of the total equity. This would leave dissenting institutions in limbo with a large minority …
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Publication information: Article title: Battle Looms over Harvey Nichols Buyout as Largest Minority Shareholder Rejects Poon Offer. Contributors: Cope, Nigel - Author. Newspaper title: The Independent (London, England). Publication date: November 2, 2002. Page number: 23. © 2009 The Independent - London. Provided by ProQuest LLC. All Rights Reserved.
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