Shareholders Express Resistance to Wagamama Takeover Bid
They say the price of buying the Pan Asian restaurant is “far too large”.
A second major investor who refused to be named has also expressed their opposition against the acquisition of The Restaurant Group.
According to a report by City A.M., the news follows after Columbia Threadneedle, who owns 7.7% of the company, also voiced the same concerns saying that they vote down against it.
Last week, GrizzlyRock Capital and Vivaldi Asset Management who jointly own 19% or 3.9 million shares labels the acquisition “overly risky and expensive” for Restaurant Group shareholders. They also said that there has been a 25% or £150 Million decline in market capitalisation since the deal was announced.
“Management grossly miscalculated their cost of capital and shareholder willingness to participate in a transaction. We urge management to pay the nominal, £6 million, deal break fee and continue operating the current business on behalf of shareholders,” GrizzlyRock Capital’s portfolio manager Kyle Mowery said.
“At today’s share price, the £315 million rights offering management is asking shareholders to provide for the transaction is nearly 70% of current market capitalization. This amount both in absolute size and especially percentage of the current market capitalization is far too large,” he continued.
On early November, it was announced that Wagamama will be sold to Restaurant Group for £357 million.
