Pivovary Lobkowicz Group AS rallied the most on record after Chief Executive Officer Zdenek Radil offered to pay a premium for a majority stake in the Czech brewer.
Investors scooped up the stock as the company said on Thursday that Radil’s Lobkowiczky Pivovar AS had agreed to buy a 79.4 percent stake from Palace Capital AS and GO Solar for 1.9 billion koruna ($78 million). That would value the company at 2.4 billion koruna, or about 205 koruna a share and 14 percent above Wednesday’s closing price.
“We consider the news positive given the premium to the market price,” Milan Lavicka, an analyst at J&T Banka AS, said in an e-mailed report to clients. The Prague-based bank has a buy recommendation on Pivovary Lobkowicz.
The shares climbed 7.3 percent to 192.1 koruna, the steepest intraday increase and the highest price since the company’s initial public offering in May last year. The stock’s turnover was more than four times the three-month daily average as of 3:08 p.m. in Prague.
Lobkowiczky Pivovar must pay for the stake by the end of August for the takeover to materialize and it will finance the deal with a combination of debt and “own capital from several financial institutions and private investors,” the brewer said in a statement. The new majority owner will be obliged to make a buyout offer to all remaining shareholders.
“The price of the mandatory buyout should be similar” to the price paid to Palace Capital and GO Solar, Petr Bartek, an analyst at Ceska Sporitelna AS in Prague, said in an e-mail. “We therefore regard the acquisition price as high and positive for minority shareholders.”