G4S PLC’s (LON:GFS) fate is to be settled by auction after the two suitors for the security and manned guarding group agreed to a five-day bidding process.
FTSE 250-listed G4S has received offers of 245p per share from Allied Universal, which the board has recommended, and 235p per share from GardaWorld, which has been rejected.
To decide the matter, both bidders have agreed to a highly unusual sealed bid auction that will run for five days from Monday 22 February 2021 until Friday 26 February 2021 with new bids being allowed on a daily basis.
If one of the bidders drops out, the auction comes to an end.
Shares in G4S were trading at 267.2p today, well above the level of the Allied Universal offer suggesting investors believe that the bidding during the auction week will be fierce.
At 267p, G4S is valued at £4.15bn.
G4S directors have consistently rejected the approaches of Canadian group GardaWorld, which sparked the takeover battle in September last year when it went public with 190p per share cash offer.
That was a 30% premium to the share price at the time.
GardaWorld said that G4S rejected three private approaches before it went public with its bid.
Allied Universal, a US-based me-too competitor to G4S, made its approach in October 2020 and confirmed its interest with the 245p per share offer in December.