Evolution’s Board says Candle Lake offer does not reflect the fair market value of Evolution, especially compared to its current share price
Evolution has recommended that its shareholders do not accept the recent takeover offer from its largest shareholder, Candle Lake.
Candle Lake submitted its takeover offer after attaining a direct holding of 30.02 per cent of the total number of shares and votes in Evolution on 24 July.
This triggered a mandatory takeover bid under the Swedish Act on Public Takeovers on the Stock Market.
On 13 August, Candle Lake made a mandatory offer of SEK695 per share, payable in cash, valuing Evolution at approximately SEK131.7 billion (approx. €11.97 billion).
The offer price corresponds to the closing share price of SEK695 on 24 July, and a premium of approximately 1.6 per cent compared to the volume-weighted average trading price of SEK683.8 during the period of 20 trading days up to and including 24 July.
The offer price is also a discount of approximately 5.7 per cent compared to the closing share price of SEK737.2 on 12 August, and a discount of approximately 3.3 per cent compared to the volume-weighted average trading price of SEK 718.8 during the period of 20 trading days up to and including 12 August.
Based on an assessment of a number of factors, Evolution’s Board of Director has evaluated the offer in accordance with the Takeover Rules, including the current price of Evolution’s shares, the company’s strategic and financial position, and its expected future development and related opportunities and risks.
The Board also noted that Candle Lake has expressed that the offer is not motivated by any intention to acquire all outstanding shares in Evolution and that the offer is made pursuant to Candle Lake’s mandatory offer obligation.
Based on its assessment, and in light of the discount in offer compared to the company’s current share price, the Board considers that the offer does not reflect the fair market value of Evolution and recommends shareholders to not accept the offer.
The Board has appointed Gernandt & Danielsson Advokatbyrå as legal advisors in connection with the offer.
Candle Lake is a Cayman Islands-based investment firm ultimately controlled by Kenneth Dart, which also owns a significant stake in Flutter Entertainment.
Shares in Evolution AB (STO:EVO) were trading 0.66 per cent higher at SEK825.40 per share in Stockholm earlier Monday, which is now 18.8 per cent higher than the offer price.