EAMONN ROTHWELL and the Philip Lynch-led Moonduster consortium have requested an extension to the deadline for them to make an offer for listed ferry company Irish Continental Group (ICG).
The request was made to the board of ICG yesterday. The board is expected to give its answer either today or tomorrow and sources speculated yesterday that it could ask the Irish Takeover Panel to issue a so-called “put up or shut up” deadline to the consortium, thereby forcing it to lodge a bid within a definite timeframe or walk away.
The board of ICG last week set the close of business yesterday as the deadline for an offer to be tabled by Mr Rothwell and Moonduster. This was not met.
Mr Rothwell and Moonduster – which comprises Mr Lynch’s One51 investment group and the Doyle shipping company – are believed to be finalising a package of finance for their bid.
This is expected to comprise funding from AIB, Bank of Ireland and possibly Bank of Scotland (Ireland) and another international institution.
Moonduster indicated in October that it was considering an offer for ICG and it emerged in December that it had teamed up with Mr Rothwell to explore a joint bid for the ferry business.
The Irish Times yesterday revealed that Mr Rothwell and Moonduster, who own 41 per cent of the ferry company between them, are likely to make a bid of up to €15 a share for ICG. This would represent a premium of just 3.4 per cent on ICG’s current share value of €14.50.
It seems unlikely that this level of bid would receive a recommendation from the board of ICG.
That would leave the bid dependent on the support of property developer Liam Carroll, who owns 29.24 per cent and is ICG’s biggest shareholder, and institutions with large holdings.
Mr Carroll is believed to have borrowed about €200 million from AIB to buy his ICG shares in 2007 at a level of more €20 apiece. It is not clear if he would be prepared to take a large hit on his investment.
ICG’s board is expected to seek a bid of closer to €20 a share – Mr Rothwell’s Aella consortium bid €24 a share two years amid a bitter takeover battle with Moonduster. The bid was rejected by shareholders.
ICG’s board will argue that it is a highly cash-generative business and has significantly reduced its net debt in recent years. ICG’s debt fell to €48.7 million in 2008 from €84.5 million a year earlier and could be wiped out in 2009.
The consortium, meanwhile, is expected to highlight to investors the fact that ICG’s passenger, car and freight volumes declined last year as the economy slumped.
Its revenue fell by 3.6 per cent to €342.9 million although its operating profit rose by 4.5 per cent to €41.8.million.
