- NAS becomes largest shareholder
- Further takeover bid could be imminent
John Menzies’ (MNZS) shares shot up by a quarter on Thursday after logistics group National Aviation Services (NAS), which is pursuing a takeover of the Edinburgh-based air services company, bought a 13 per cent stake in the business.
Kuwait-based NAS, a subsidiary of Agility Public Warehousing Co (KW:AGLTY), agreed to buy £73mn worth of Menzies shares at 605p a share. This makes NAS its largest shareholder.
The market is now anticipating a new bid, with two proposals from NAS for the full share capital of the business rejected so far in 2022. NAS has until 9 March to to make a formal offer for the company or a “firm intention” to make an offer.
In January, a 460p a share offer was shot down and a second approach in early February at 510p a share met the same fate. Menzies’ board said that the second bid was “entirely opportunistic", conditional and that it fundamentally undervalued the company and its prospects.
The latest development means that, due to Takeover Panel rules, a new bid for Menzies would have to be for at least 605p a share – this price acts as a floor.
Menzies’ board said that, in reference to a further bid, it “will consider the best interests of Menzies’ shareholders and all actions to maximise shareholder value”.
Menzies’ shares are now trading above pre-pandemic levels. The company has struggled in recent times due to severe restrictions on travel, but there are hopes that brighter skies lie ahead.
In a recent trading update on the fourth quarter of its 2021 financial year, Menzies announced positive cash generation and a strong liquidity position.
We stick with our hold recommendation, for now, until the takeover picture becomes clearer.
