Steinhoff has upped its cash offer for Poundland (PLND) by 5p to 225p a share this morning following pressure from an activist investor.
The new and final offer is made up of 225p in cash for each share and another 2p dividend to value the discount chain at £610.4m.
Activist fund Elliott Capital had built its stake to be big enough to block the Steinhoff deal after growing its stake to 17.5% in recent weeks, forcing Steinhoff to up its offer.
Elliot Capital was also one of the investors which forced an improved offer from AB InBev for SABMiller last month, when the brewer raised its cash offer by £1 per share.
The new offer represents a 43.4% premium to the closing price of Poundland shares of 158.3p on 13 June, the day prior to Steinhoff’s interest in Poundland emerging, and a 15.8% premium to 196p price on day before the original offer.
Poundland chairman Darren Shapland said: “The Poundland board is pleased to recommend Steinhoff’s increased all-cash offer which presents Poundland shareholders with an opportunity to realise their shareholding at an improved price and on an enhanced premium to Poundland’s undisturbed share price.
“Steinhoff is a well-capitalised, international business with a clear and proven commitment to value retailing. Steinhoff continues to share our vision for the growth and expansion of Poundland and, as such, we believe they are a suitable and appropriate partner for our colleagues, suppliers and stakeholders.”
Steinhoff CEO Markus Jooste added: “As a group Steinhoff invests in businesses where it sees opportunities to deliver attractive returns to its own shareholders.
“We believe there is significant merit to both Poundland and Steinhoff in bringing Poundland into our global operations, and the Steinhoff directors and management are enthusiastic about the related opportunities that will arise.”
Despite the improved bid Poundland shares are down 1% this morning to 221.8p.
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