Costa Group has announced its acceptance of a A$1.5 billion acquisition offer from a consortium led by private equity firm Paine Schwartz Partners (PSP). This decision, revealed on September 22nd, involves entering into a Scheme Implementation Agreement.
The consortium led by PSP comprises entities under the control of PSP, Driscoll’s, and the British Columbia Investment Management Corporation. These entities affiliated with PSP and Driscoll’s collectively hold about 19.62 percent of Costa’s currently outstanding shares.
As per the agreement, the consortium will acquire the remaining Costa shares at A$3.20 per share, resulting in an approximate valuation of A$1.496 billion for Costa’s equity. This aligns with an updated offer Costa received earlier in the same month, which was a reduction from PSP’s original offer presented in July.
Costa’s board of directors, in their announcement, unanimously deemed the scheme to be in the best interests of Costa shareholders. They recommend that Costa shareholders vote in favor of the scheme unless a superior proposal emerges or an independent expert determines, and continues to affirm, that the scheme is not in the best interests of Costa shareholders.
Each Costa director intends to vote all of their Costa shares in favor of the scheme, with the same qualifications mentioned above, according to the board. Neil Chatfield, the Chairman of Costa, stated, “The board is committed at all times to acting in the best interests of shareholders… the scheme provides certainty for shareholders in an uncertain operating environment by delivering cash proceeds to shareholders at an attractive premium.”
Costa anticipates that the acquisition will be completed in the first quarter of 2024, contingent upon obtaining shareholder approval by the necessary majorities and fulfilling the other conditions outlined in the scheme.