TP Group PLC (AIM:TPG) (AIM:TPG) said its board have unanimously rejected a takeover offer from major shareholder Science Group PLC (AIM:SAG) (AIM:SAG), saying the 5.8p per share offer “significantly undervalues” the firm.
“On behalf of the board, I confirm that we have carefully considered and unanimously rejected Science Group’s approach, which is opportunistic, conditional and unsolicited,” Andrew McCree, non-executive chair of the engineering firm, said in a statement.
“In David Lindsay, we have a new CEO leading the company and a plan for growth. The approach by Science Group undervalues TP Group, and is an unwelcome distraction from implementing our growth plan… The board will do all it can to ensure that any attempts to undermine the value or reputation of the group will be strongly resisted in the best interests of its shareholders and customers,” he added.
The rejection of the offer followed an announcement from Science Group on Monday that TP Group’s board had rejected the approach without any discussion or engagement.
Science Group went on to say that it is still interested in making an offer for TP Group, but said it is unlikely that it will be able to make an offer if the TP Group board continues to refuse to cooperate.
However, TP Group hit back on Tuesday by saying that the “clear operational synergies” between the two firms referred to by Science Group in its Monday announcement did not exist in its own view given that the two firms operated in “fundamentally different” markets and fields.
The firm also said the proposal was seeking to capitalise on “the short-term impact suffered by the company as a result of the COVID-19 pandemic”.
TP Group also highlighted that Science Group has convened a general meeting to remove McCree and non-executive director Jeremy Warner-Allen from the board and in their place appoint two of its own directors, Martyn Ratcliffe and Peter Bertram.
“The board has no intention of engaging with Science Group on the proposal and has unanimously rejected it in order to focus on delivering its plan for TP Group and creating shareholder value,” McCree concluded.
Amid the bid battle, shares in TP Group jumped 3.9% to 5.3p in early deals on Tuesday, still shy of the offer price, while Science Group rose 3.2% to 459p.