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Colt Rebuffs Fidelity’s ‘Undervalued’ Offer

by Jeff Patterson
  • Colt has appointed Barclays Bank PLC as an intermediary and independent financial adviser, that sees Fidelity's offer as undervalued.
Colt Rebuffs Fidelity’s ‘Undervalued’ Offer
Photo: Bloomberg
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Colt Group S.A., a provider of network, voice and data services, have shot down an offer by FMR LLC, FIL Limited, representing Fidelity at a combined price of 190 pence per share, according to a Colt Statement.

Talks of a deal have been swirling for some time with the rebuttal representing the latest development for Colt. Independent directors have appointed Barclays Bank PLC as an intermediary and independent financial adviser.

As a result, the appointed independent directors have deflected Fidelity’s offer, citing an undervalued stance for Colt – moreover, the independent advisers have advised Colt to reject the offer as unfair to independent shareholders of the company stock.

The 2015 calendar year saw ardent attempts by Colt’s senior management to reinforce and refocus the firm’s activities and financial performance, tapping its ‘new business plan’. In subsequent months, Colt’s Board provisionally approved the ‘new business plan’ with additional details slated for announcement.

In addition to its business development, Colt’s independent directors believe that any tendered sale of the company to a third-party buyer could potentially achieve a higher price than the proposed offer. Ultimately however, the independent directors noted that the commitment by Fidelity that it would not engage in purchase selling or disposal of Colt shares or take any other offer to a third-party prior to the end of 2016 could gave clues as to Fidelity’s motives or reasoning.

At the end of the day however, money talks and many shareholders would no doubt be content with a cash offer presently. As a result, the independent directors will facilitate Fidelity’s offer by convening a meeting of the shareholders to consider the resolutions proposed.

Colt has been relatively mum with a number of partnerships with one of his most high profile ones coming nearly a year ago with the London Metal Exchange (LME), resulting in the launch of LMEnet – a collective effort to upgrade Connectivity to electronic systems for the Exchange.

Colt Group S.A., a provider of network, voice and data services, have shot down an offer by FMR LLC, FIL Limited, representing Fidelity at a combined price of 190 pence per share, according to a Colt Statement.

Talks of a deal have been swirling for some time with the rebuttal representing the latest development for Colt. Independent directors have appointed Barclays Bank PLC as an intermediary and independent financial adviser.

As a result, the appointed independent directors have deflected Fidelity’s offer, citing an undervalued stance for Colt – moreover, the independent advisers have advised Colt to reject the offer as unfair to independent shareholders of the company stock.

The 2015 calendar year saw ardent attempts by Colt’s senior management to reinforce and refocus the firm’s activities and financial performance, tapping its ‘new business plan’. In subsequent months, Colt’s Board provisionally approved the ‘new business plan’ with additional details slated for announcement.

In addition to its business development, Colt’s independent directors believe that any tendered sale of the company to a third-party buyer could potentially achieve a higher price than the proposed offer. Ultimately however, the independent directors noted that the commitment by Fidelity that it would not engage in purchase selling or disposal of Colt shares or take any other offer to a third-party prior to the end of 2016 could gave clues as to Fidelity’s motives or reasoning.

At the end of the day however, money talks and many shareholders would no doubt be content with a cash offer presently. As a result, the independent directors will facilitate Fidelity’s offer by convening a meeting of the shareholders to consider the resolutions proposed.

Colt has been relatively mum with a number of partnerships with one of his most high profile ones coming nearly a year ago with the London Metal Exchange (LME), resulting in the launch of LMEnet – a collective effort to upgrade Connectivity to electronic systems for the Exchange.

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