The board of IP Group PLC (LSE:IPO), the London-listed technology investor, may struggle to recommend an improved takeover proposal from pension fund Railpen without further concessions, according to Deutsche Bank.
Railpen returned with a revised offer ahead of today's put up or shut up deadline, when it must either make a firm bid or walk away.
The new proposal comprises 61p a share in cash, an in-specie distribution of IP Group's stake in Oxford Nanopore worth about 10.6p a share, and a contingent value right linked to Metsera worth up to 11.3p a share.
That implies headline value of up to 82.9p a share, or 71.6p excluding any value from the contingent right.
Deutsche said the revised structure addressed one of its earlier concerns, that the original approach left too much upside with the buyer.
Even so, only 61p a share is fixed cash, with a meaningful portion of the value still contingent.
Analyst Kane Slutzkin noted that even assuming the contingent right pays out in full, the proposal represents around a 25% discount to IP Group's last reported net asset value of 110p, widening to about 35% excluding it.
The bank kept a buy rating and 110p target on the shares, which closed at 64.7p.
Deutsche said the changes might encourage further talks.
