Sanne rejects $1.90 billion buyout proposal from Cinven

By Reuters

<p><body> <p>By Yadarisa Shabong</p> <p>(Reuters) -Asset management services provider Sanne Group rejected buyout firm Cinven’s 1.35-billion-pound ($1.90 billion) proposal as too low, the London-listed company said on Friday, expressing no interest in further engagement with the fund.</p> <p>Shares in the <span class="caps">FTSE</span> 250 company jumped as much as 27% to 766 pence, lower than the 830 pence per share proposal. </p> <p>The unsolicited proposal is the third in recent months, Sanne said. It comes at hefty premium of about 38% to Sanne’s last closing price.</p> <p>“The board engaged with Cinven to explain why the proposal significantly undervalues the Company and why it does not merit further engagement,” Sanne said in a statement, adding that it is confident of its standalone prospects.</p> <p>Hargreaves Lansdown analyst Nicholas Hyett said shares trading below the offer price indicates that “investors think there’s a strong chance Cinven will walk away from the deal without improving its offer.”</p> <p>Jersey-based Sanne, which provides outsourcing services to clients in dozens of countries, last year recorded a 12% increase in annual earnings to 48 million pounds as it won new businesses and made several acquisitions.</p> <p>Cinven, whose investments are focussed in North America and Europe, said it was considering its options. It has until June 11 to make a firm offer or walk away.</p> <p>The alternative asset and corporate services provider became the latest UK-listed takeover target by a private equity firm, as a list of companies this year have attracted bids.</p> <p>UK-listed companies continue to carry a “stubborn” valuation discount to global peers, analysts at Panmure Gordon said, which they said had triggered mergers and acquisition deals worth more than 42 billion pounds this year. </p> <p>Cinven said its proposal also allowed eligible Sanne shareholders to retain the right to collect the company’s final dividend declared in March. </p> <p>Sanne employs more than 1,900 people globally and has a client roster of nearly 2,000 varying in type from private debt to capital markets and real estate. </p> <p>($1 = 0.7117 pounds)</p> <p> (Reporting by Yadarisa Shabong and Muvija M in Bengaluru;editing by Vinay Dwivedi and Jason Neely)</p> </body></p>