PRAGUE (Reuters) - The board of Pegas Nonwovens (PGSN.PR) has backed a takeover offer from R2G, the bidder said on Friday, adding it was ready to absorb short-term losses and would limit or halt the dividend.
Investment firm R2G, the second largest shareholder in Pegas with a 10.82 percent stake, said in July its investment vehicle R2G Rohan Czech would bid 1,010 crowns per share, valuing Prague-listed Pegas at 8.9 billion crowns ($403 million).
R2G said on Friday Pegas’s board supported the offer price, calling it “fair”. The artificial textile maker’s shares were down 0.3 percent at 1,016 crowns at 0826 GMT.
“(R2G Rohan Czech) is ready to absorb all short-term and mid-term losses and to limit or halt flow of finances to shareholders in order to ... build a stronger, more competitive and more global firm in the long-term,” R2G said.
A representative of Wood & Co, Pegas’s largest shareholder with a 28.8 percent stake, abstained in the board vote.
J&T analyst Bohumil Trampota said shareholders were now likely to assume a wait-and-see position.
“It seems R2G and Wood are not acting in concert, there could be a clash between the two now. Some investors might be disappointed there was no premium to existing share price offered,” he said.
R2G said there would be no clash.
“Either Wood will take our offer and it will sell to us, or we will be there alongside each other in a longer term. There is no clash,” R2G’s head of investments Jakub Dyba told Reuters.
Wood & Co said it was glad to see other investors interested in developing Pegas and that it did not plan to sell.
“We welcome stabilization of shareholders’ structure. At its current price, Pegas looks like an attractive investment opportunity to us, therefore we are not considering a sale,” Wood & Co partner Jan Sykora told Reuters.
($1 = 22.1110 Czech crowns)
Reporting by Jan Lopatka and Robert Muller; Editing by Mark Potter