On Thursday last week Tyro (TYR) announced that it had received an unsolicited, non-binding and indicative proposal from a consortium of private equity investors led by Potentia Capital Management. The proposal values TYR at $1.27.
TYR board considered the proposal and has flat out rejected the takeover saying the offer to acquire the company is materially below the fundamental value of the company and is highly opportunistic.
It is likely the rejection of the initial takeover offer is only the first salvo and what could be a drawn-out negotiation over the coming months.
Potentia Capital also advised that it has entered a Voting and Acceptance Deed with Grok in relation to its 12.5% shareholding in TYR. Grok will adept a takeover bid made by Potentia and vote in favor of the proposed takeover by Potentia at the $1.27 offer price. Grok cannot take any action under a competing proposal unless a new proposal has a value of $0.25 per share greater than the $1.27 offer currently on the table.
The agreement with Grok means any competing proposal must be launched at a much higher price than the current offer for Grok to accept the new takeover. This makes it harder for a competing proposal but not impossible.
With the TYR share price closing at $1.375 in trading last week above the $1.27 takeover from Potentia this signals the market is anticipating a higher offer price.
For the moment we will hold out existing position and see how the takeover plays out over the next few months.
Trade Action
Increase stop loss level to $1.10
