Corporate investment group Mariner has made a $19.7 million scrip takeover bid for struggling surfwear group Globe only two days after the surfwear group received a second strike against its remuneration report which spilt the board.
Mariner told the Australian Securities Exchange today that it had the offer to the Globe board, offering 47.5 cents per share for each Globe share, totalling $19.7 million for the company's 41.463 million shares.
However, the offer is not a cash bid. Mariner will offer 5 fully paid Mariner shares for every 4 fully paid Globe ordinary shares. Based on the closing prices of Mariner and Globe shares yesterday, Mariner said its offer represented a 21.8 per cent premium to the Globe closing price of 39 cents on November 15.
Globe shares have risen 6.4 per cent to 41.5 cents today, while Mariner shares have fallen 7.9 per cent to 35 cents.
Mariner said in a statement to the Australian Securities Exchange today it was making the offer because Globe had performed poorly for many years and it believed there was appetite among Globe shareholders for a change.
It said by converting their stock to Mariner shares Globe investors had the opportunity to become part of a growing and successful Australian investment company.
"Mariner's objective is to become a substantial shareholder of Globe, seek board representation and implement strategies to bridge the gap between Globe's NTA and Globe's current share price," the company said.
Globe's NTA was $26.5 million at June 30 against a market capitalisation of $16.6 million.
"Mariner has a proven track record," the company said in its statement.
"We create value for Mariner shareholders by driving change in the companies in which we invest. Investors who want to unlock value for their Globe shareholding should become Mariner shareholders."
Globe chief executive Matthew Hill and his brothers Peter and Stephen hold a 67.8 per cent stake in the company and will be the key to the takeover's success or failure. Globe has yet to release a statement on the scrip takeover offer from Mariner.
It has been a troubled time for Globe and its major shareholders, the Hill family.
On Wednesday retail billionaire Solomon Lew and fund manager Kidder Williams triggered a spill of the Globe board at its annual meeting after voting against its remuneration report for a second consecutive year. Mr Lew has a 5.9 per cent stake in the company and Kidder Williams holds 2.3 per cent.
Globe's net profit fell to only $62,000 last financial year, down 95 per cent from $1.09 million in the previous year. Revenue was down slightly to $83 million.