Maxim_Kazmin - stock.adobe.com
A fight has erupted for KCOM after a second suitor tabled an offer for the telco specialist putting the brakes on a deal that had emerged back in April.
It had been looking as if the firm had accepted a £504m offer from Humber Bidco Limited a wholly-owned indirect subsidiary of Universities Superannuation Scheme Limited, with a final decision on whether or not to accept it just a few days away.
But a last minute offer from MEIF 6 Fibre has now been trumped the first offer, raising the stakes with a £563m takeover bid.
MEIF 6 Fibre is owned by Macquarie Infrastructure and Real Assets, with the KCOM board backing the latest offer and revising their initial support for the first deal.
"The Board of KCOM is pleased to recommend MEIF 6 Fibre's cash offer for KCOM which represents an increase of 11 pence to the USS Offer of 97 pence per KCOM Share and a 49 per cent premium to the undisturbed share price on 23 April 2019. This offer provides our shareholders with even greater value in cash for their shares, as well as providing KCOM with a strong partner as we work to maintain, build and enhance our offering and position," said Patrick De Smedt, interim non-executive chairman of KCOM.
Commenting on the acquisition, Leigh Harrison, head of MIRA EMEA, said that it had a background in the industry and saw potential in the business.
"We are pleased that the KCOM Board is recommending our takeover offer. KCOM has a strong local heritage that has been developed over more than a century and is well-positioned to continue to meet the evolving telecommunications needs of the region, which is why we have made this compelling offer to shareholders at an attractive premium," he said.
"As an experienced, long-term telecommunications investor, we are committed to supporting KCOM's sustainable growth. We look forward to partnering with management to increase broadband take-up in its core region and beyond, enhancing the quality of service delivery while giving local businesses and residents greater access to the opportunities that high-speed broadband can provide," he added.
KCOM issued a profit warning last year and turned to former BT executive Sutherland to help change its fortunes after sharing a half year update issued back in November showing that revenues were down and pre-tax profits had also declined by 4% year-on-year.
The firm provides voice and data services to 140,000 customers in Hull and East Yorkshire, has a public sector and large enterprise customer lost across and through its national network services provides UK wide connectivity support.