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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Mallett | LSE:MAE | London | Ordinary Share | GB0005583504 | ORD 5P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 55.00 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
RNS Number:4908H Mallett PLC 14 February 2003 Mallett PLC ("Mallett") 14 February 2003 Response to Tender Offer Mallett PLC has today written to shareholders with regard to the tender offer announced to the London Stock Exchange on 6 February 2003 by Trefick Limited. The following is the main written text of the letter sent to shareholders: "Tender Offer by Trefick Limited ("Trefick") On 6 February 2003, Trefick announced an unsolicited and unwelcome Tender Offer to acquire up to 7.4 per cent. of the issued share capital of Mallett. This Tender Offer is an opportunistic attempt to take advantage of uncertain current stock market conditions in order to acquire your shares at a price which undervalues Mallett shares and does not allow you to receive the final dividend for the year ended 31 December 2002. I am writing to advise you that your Board, which has been advised by Close Brothers, unanimously recommends that you do not accept the Tender Offer. The Tender Offer You recently have received a document from Trefick which seeks to acquire your shares at a price of 225 pence. This document was posted following an announcement to the London Stock Exchange on 6 February 2003 that Trefick had made a Tender Offer to acquire up to 1,015,610 ordinary shares in Mallett, representing 7.4 per cent. of its issued share capital, at 225 pence per share. As at 6 February 2003, Trefick owned 3,110,607 ordinary shares, representing 22.5 per cent of the issued share capital of the Company. Should the Tender Offer be successful, Trefick would own 29.9 per cent. of the issued share capital of the Company. Trefick The intentions of Trefick in relation to Mallett are not clear and, so far as the Board is aware, Trefick has no previous experience of the market for high quality antiques. Under the Tender Offer, Trefick is seeking to acquire the maximum number of shares it can obtain without being obliged by the City Code to launch a takeover offer for the whole of the Company's share capital. The Tender Offer document states that "Trefick has no intention of making a general (takeover) offer for a controlling stake in Mallett PLC". This is inconsistent with impressions gained by members of the Board. Shareholders should note that, pursuant to the City Code, Trefick's statement in its document will prevent such a takeover offer from being made only for a period of up to six months. Trefick gives no reason for you to tender your shares in its Tender Offer document. It is clear that Trefick appreciates the true value of Mallett's shares - you should not sell your shares in Mallett to Trefick on the cheap. Why you should ignore the Tender Offer In recommending that you ignore the Tender Offer by Trefick, the Directors have taken into account the factors set out below: Mallett's strong market position and trading record Mallett has a strong market position and an excellent reputation and track record as one of the world's leading international dealers in high quality antique furniture, glass and works of art. These qualities are reflected in the strong trading record of the Company, which expects to report on 18 February 2003 its preliminary results for the year ended 31 December 2002. These are expected to show a profit on ordinary activities before taxation of not less than #5.0 million (2001: #4.328 million) and earnings per share of not less than 25 pence (2001: 21.46 pence) - an increase of at least 16.5 per cent. These results illustrate the strong sales and trading skills of the management team at Mallett and have been achieved against the background of a challenging trading environment and in contrast to results reported by other antique dealers. In line with these strong results, the Board expects to declare a final dividend of 6.8 pence per share, making a total dividend for the year of 9.2 pence - an increase of 12.1 per cent. from the previous year. Shareholders should note that they will not receive the final dividend of 6.8 pence if they accept the Tender Offer. Mallett's prospects The planned opening of a new shop on Madison Avenue in New York is a significant development for the Company and is expected to take place on schedule in April 2003. The New York shop will improve the Company's ability to serve its substantial and growing number of American clients. The strong results for 2002 were achieved in a challenging trading environment and were aided by a small number of very substantial transactions. Despite the uncertain and volatile outlook and the increase in the Company's cost base, the Board is confident in the continuing global market for the finest antiques. Net asset position Mallett has strong asset backing, with net assets per share increasing every year since its flotation in 1987. The Company has an outstanding stock of antiques for resale and has valuable property interests through its ownership of a long lease at Bourdon House, 2 Davies Street, London, the leasehold of 141 New Bond Street, London and the leasehold at 929 Madison Avenue, New York. Your Board believes that Mallett's assets are worth considerably in excess of their book value. As at 30 June 2002, the Company had net book assets of #27.6 million representing 200 pence per share and at 31 December 2002 will have net book assets in excess of this figure. The small premium offered by the Trefick Tender Offer The Tender Offer of 225p represents a premium of only 5.4 per cent. over the average mid-market price of a Mallett ordinary share over the six month period immediately prior to the announcement of the Tender Offer. Mallett's authority to repurchase shares Shareholders are reminded that the Board has authority to repurchase up to 10 per cent. of its share capital in the market. It is intended that the Board will seek to renew this authority at the forthcoming annual general meeting currently scheduled for May 2003. Following the announcement of preliminary results, which is expected to take place on 18 February 2003, your Board will consider using its existing authority to repurchase shares in the market, subject to prevailing market conditions and the availability and price of Mallett shares. The Company's existing authority permits it to purchase up to 10 per cent. of its issued share capital at a premium of up to 5 per cent. above the average middle market quotation of a Mallett share at the close of business on the five business days immediately preceding the date of any purchase. Recommendation The Directors will not be accepting the Tender Offer in respect of any of their holdings and have also received indications in writing from other shareholders that they will not be accepting the Tender Offer. The total of these shares represents 60.8 per cent. of Mallett's issued share capital not already owned by Trefick. Your Board, which has been advised by Close Brothers, unanimously recommends that shareholders do not accept the Tender Offer. In providing advice to the Board, Close Brothers has relied on the commercial assessments of the Board." Enquiries: Mallett PLC Peter Dixon 020 7499 7411 Close Brothers Mark Wrightson 020 7655 3100 Christopher Lewey Close Brothers Corporate Finance Limited, which is regulated in the United Kingdom for the conduct of investment business by the Financial Services Authority, is acting exclusively for Mallett PLC in connection with the matters described herein and no-one else and will not be responsible to anyone other than Mallett PLC for providing the protections afforded to customers of Close Brothers Corporate Finance Limited, nor for providing advice in relation to the matters described herein nor on any other matter. This information is provided by RNS The company news service from the London Stock Exchange END RSPLXLLFXLBBBBV
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