Proactive Investors - Run By Investors For Investors

The Reject Shop fends off takeover with trading update

The company is currently being bid for in a cash takeover priced at $2.70 per share.
business man fending off dinosaur with umbrella
The board believes the takeover is opportunistic

The Reject Shop Ltd (ASX:TRS) has revealed that it expects net profit after tax (NPAT) for the December half to be around $10.5 million.

This estimate is based on unaudited results and is in line with the guidance provided in October 2018 of December half NPAT to be in the range of $10.0 to $11.0 million.

The company will release its formal audited December half results on 20 February 2019.

The Reject Shop recommends shareholders reject takeover offer

The Reject Shop’s chairman Bill Stevens said: “Consistent with the guidance provided in the trading update issued by The Reject Shop on 17 October 2018; and re-affirmed in the company’s target’s statement dated 3 December 2018 in response to the on-market takeover offer by Allensford Pty Ltd as trustee for the Allensford Unit Trust.

“Notwithstanding the ongoing challenges of a very competitive retail environment, our team members responded in presenting a November and December store offering that was well supported by our customers.”

On 21 November 2018, Allensford Pty Ltd made an unconditional on-market takeover cash offer for The Reject Shop of $2.70 per share.

Allensford went on to say that it would stand in the market and buy shares at the offer price of $2.70 for a defined period of time.

Company says trading update shows that offer is opportunistic

Stevens added: “Today’s announcement is issued in the context of the takeover offer from Allensford, which is currently due to close on 22 January 2019.

“Allensford’s replacement bidder’s statement dated 3 December 2018, together with its second supplementary bidder’s statement dated 20 December 2018, contained a number of speculative comments in respect of The Reject Shop’s trading performance over the first half of FY2019 that have been shown to be unfounded.

“Amid a backdrop of highs and lows over the past few years, your Board continues to believe in the long-term growth prospects of The Reject Shop’s business, which has remained profitable despite the extremely challenging and fluctuating retail environment.”

Allensford extends offer period after trading update

Yesterday, after-market and following the trading update, Allensford extended the aforementioned offer period to 6 February 2019.

View full TRS profile View Profile

The Reject Shop Ltd Timeline

Related Articles

drainpipes
Thu
Company is looking for more acquisitions after integration of Metro Rod
H&T
Tue
"The group's performance over the past three years demonstrates the continuing success of our strategy to access more customers and markets," said chief executive John Nichols.
Scans and MRI
November 28 2018
The firm's subsidiary, Imaging Biometrics, recently appointed a South Korean distributor a few weeks after receiving the first commercial order for its StoneChecker technology

© Proactive Investors 2019

Proactive Investors Australia PTY LTD ACN:132787654 ABN:19132787654.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use