BCA Marketplace PLC (LON:BCA) shares jumped nearly 10% higher on Monday, driven by news the firm has rejected a takeover proposal from private equity firm Apax Partners LLP.
In a statement, the FTSE 250-listed used car marketplace and owner of webuyanycar.com said Apax had approached the firm with a conditional all-cash offer of 200p for each BCA share.
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That indicated offer price was around a 5.2% discount to the BCA closing share price of 211p last Friday, June 8. In early afternoon trading on Monday, BCA's shares were 9.9% higher at 232p reflecting hopes that an increased offer could be forthcoming.
BCA noted that Apax now has until 5pm on 8 July to announce the firm intention to make an offer, but added that there is no certainty that any offer would be made.
Apax revealed in a statement on Sunday that it was considering a possible bid for BCA following recent media speculation as to a possible takeover.
Classic private equity behaviour
Russ Mould, investment director at AJ Bell commented: “A takeover approach for car auction expert BCA Marketplace looks like classic private equity behaviour: swoop when someone is temporarily down.”
He added: “A sharp decline in the share price earlier this year – amid widespread concerns about demand for new and second-hand cars in the UK – has resulted in bid interest from Apax Partners. The share price went from 204.2p at the start of 2018 to a low of 149.6p in March.”
Mould concluded: “BCA’s shares are now trading at an all-time high as a result of Apax’s interest becoming public news. This may prevent other potential suitors from wanting to show their hands unless someone is prepared to take a long-term view and has identified synergies that could warrant paying a high price today in order to make good returns down the line.”
BCA is scheduled to release its full-year results due on Thursday 28 June 2018.
-- Adds share price, analyst comment --