FTSE 250 electronics engineer Renishaw (RSW) has ended its formal sale process after unanimously concluding that none of the potential deals on offer would meet the board’s strict objectives.
Renishaw is a global champion when it comes to metrology equipment, or kit that can measures stuff down to the nth degree. This is vital in the world’s high-tech industries which increasingly operate at the molecular level.
FOUNDER CONTROL
Renishaw founders Sir David McMurty and John Deer announced in March that they intended to sell their substantial shareholdings in the company, kicking off the formal sale process.
Between them, McMurty and Deer own nearly 38.5 million shares, or 52.8% of the company, a combined stake worth approximately £2 billion at the current rough £51 shares price, up 0.5%.
‘At the start of this process we made it very clear that, with the board, we were focused on ensuring that we find the right new owner for our business,’ said McMurty and Deer. Protecting its UK base, staff and all shareholders were always paramount in the pair’s thinking.
While some investors may feel disappointed by the now reduced chances of getting a buyout premium, others will hail this as a victory for a British business that is unlikely to fall into the hands of overseas buyers because of its founder-led and controlled model, one that has caused concern among many investors this year.
That’s in stark contrast to many UK firms which are being cherry-picked by buyers from foreign markets, arguably on the cheap.
BRITISH TAKEOVERS
Supermarket chain Morrisons (MRW) is currently being chased by several private equity firms, healthcare firms UDG (UDG) and Spire (SPI) have agreed takeovers, as have infrastructure company John Laing (JLG) and property business St Modwen (SMPL).
‘We remain fully committed to Renishaw and have indicated to the board that we have no intention of selling our shares on the market for the foreseeable future,’ reassured McMurty and Deer in a statement today.
‘We continue to enjoy good health and as we consider the future of our shareholdings in due course, we intend to follow an orderly process that continues to take into account the interests of all stakeholders.’
Analysts at investment bank Berenberg found the outcome unsurprising but drew attention to Renishaw’s robust recent trading.
‘Trading in the fourth quarter has continued to be strong, with the increase in adjusted pre-tax profit for the full year 3% ahead of the midpoint of guidance given at the third quarter,’ said Berenberg. ‘The “record order book” continues to benefit from the macro recovery and particularly the strong semiconductors/consumer electronics backdrop.’
