The independent committee of the board of directors of Radisson Hospitality AB advised its shareholders to reject the increased mandatory public offer of 42.50 Swedish kronor per share by a consortium led by Jin Jiang International (Holdings) Co. Ltd.
Rothschild & Co., which was tapped to provide a fairness opinion, noted that the bid is "not fair from a financial point of view." Rothschild had presented a similar opinion Jan. 2 with regards to the initially proposed cash consideration of 40 kronor apiece.
The consortium has stated that it will offer no further increases to the 42.50 kronor-per-share consideration, which is final, or extend the acceptance period, the committee noted. Under takeover rules, the consortium is bound by its statements.
The consortium, which includes the SINO-CEE Fund, owned a 50.21% stake in Radisson through joint acquisition vehicle Aplite Holdings AB as of November 2018.
The committee said the revised bid could be an "attractive opportunity" for shareholders of the Belgian hotelier that are seeking immediate liquidity.
During its assessment, the committee, chaired by Andreas Schmid, examined factors including Radisson's current strategic and financial position, as well as its expected future development. It added that it has insufficient information regarding the consortium's strategic plans for the target company to fully gauge the increased offer's impact on Radisson and its shareholders. The committee said it had no reason to believe that the consortium would pursue an alternative approach to managing the hotelier in a way that is inferior to Radisson's five-year operating plan.
The committee highlighted that the consortium's statement regarding the impact of the implementation of the increased offer on Radisson and its employees has changed from what was set out at the time of the initial offer. The consortium noted that "no decision has been made with regard to Aplite's or Radisson's employees or management or the current organization and operation, including terms of employment or the locations where Aplite and Radisson carries out its operations."
The committee enlisted Benedetto Gartland & Co. as financial adviser and Gernandt & Danielsson Advokatbyrå as legal adviser.
As of Jan. 11, US$1 was equivalent to 8.93 Swedish kronor.