Homeserve PLC (LSE:HSV) today recommended a take-private offer at 1,200p per share but analysts stressed that the "opportunistic" offer could face rival bids.
After the FTSE 250 company announced an agreed £4.1bn cash offer from Canada's Brookfield, broker Liberum said the language of the announcement "leaves some leeway for another bid".
Liberum analyst Joe Brent added: "We are not surprised that Brookfield sees value here … and they could be accused of being opportunistic...the offer is reasonable but not knock-out and that the door is open to another bid."
At 1,200p, the offer price is a 71% premium to the price on 23 March, before Brookfield first made its interest public, and a couple of days after Homserve spun off its LeakBot business.
However, Brent pointed out, the offer price is "only a premium of 30% and 1% to where the shares traded one and two years ago, despite no downgrades".
Andrew Nussey at fellow broker Peel Hunt also view it as "a fair offer, but would not completely discount a competing offer given the unique components of value".
"However, we acknowledge the increasingly uncertain consumer environment (policy cancellations) reduces this likelihood, in our view."
Assuming the bid is accepted, he said "investors will see another high quality, market-leading and cash-generative business leave the sector".
Nussey said he expects to see further sector consolidation and public to private transactions.