Pennant Still Opposes ESML's Bid for Securitas Direct
Securitas Direct investor Pennant Capital Management LLC remains opposed to the 9.6 billion-krona ($1.5 billion) takeover bid for the Swedish alarm company by ESML Intressenter AB, with just more than a week before the acceptance deadline expires.
The hedge fund, based in Chatham, New Jersey, has not changed its position since its Nov. 21 letter urging the Securitas Direct board to reject the sale, Lui Sykes, a principal at Pennant, said today in an interview. The letter called the 26-krona-a-share offer ``grossly inadequate.''
ESML, a group of four Swedish investment companies, needs acceptance from investors representing 90 percent of Securitas Direct's stock by Feb. 1 for the bid to succeed. Pennant owned 6.5 percent of Securitas Direct in November. Lakewood Capital Management LP also sent a letter last year opposing the bid.
``We believe even a bump in the offer price would not be sufficient to close the deal,'' Sykes said today.
Sykes declined to say how much Pennant owns now.
ESML consists of Securitas Direct shareholders Saeki AB, Melker Schoerling AB, and Investment AB Latour (LATOB), together with EQT Partners AB.
The recent turbulence in stock markets has increased the chance of ESML's bid succeeding, the group's chief executive officer Ulf Svensson said, according to a report in the Dagens Industri newspaper today.
Securitas Direkt has declined 6.6 percent this year and closed at 24.2 kronor in Stockholm trading today.
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