16.12.2016

Loxam outbids TVH for Lavendon

Loxam has increased its offer for Lavendon to £2.50 a share, topping the raised offer made by TVH yesterday by a full 20p. See TVH raises its offer and has 20% of Lavendon

The formal offer - which values the company at £425 million (£583 million when the company's net debt is included) - will be mailed out to shareholders later today. The latest bid was more than 8p above yesterday's closing price. Although in early trading Lavendon shares quickly surged to £2.58, suggesting that a good few speculators believe that TVH will make a further counter offer – possibly in the region of £2.60?

The Lavendon board has recommended that shareholders accept the increased offer from Loxam.

Vertikal Comment

This battle is now quickly moving towards a climax. TVH stated at the beginning that its offer of £2.05 a share was final, now it faces the difficult decision of whether to go to £2.60 or more or drop out of the bidding.

While TVH has a total aversion to paying over the odds for anything, it probably hates to lose even more - so anything is possible. At this stage it is probably looking at a profit of around £9 million on the shares it has already acquired - although it will also be facing some substantial adviser fees.

It is hard to say which of these two will benefit the most from the Lavendon acquisition. what we are seeing here is a fight for dominance of the European powered access rental market. The surprise is that we have not seen an outsider enter the bidding. If it is going to happen this is the time for a late entrant.

Watch this space

Comments

For what's it's worth my view is that the UK powered access industry needs a good leadership?
Would TVH be happy with the 30 year old hire rates we have to suffer in the UK. I don't think so. I've visited TVH and their rental operations and seen how they operate. I've bought 4 year old 'end of hire life' kit from them. Their people can't believe how low we price valuable kit.
I'm sure that they'll be aware that if you strip out of Lavendon's results the contribution they get from training, damage waiver/insurance, renting aged fleet and then the profit on the disposal of fully written down fleet items, there's not much money to be made in renting out and delivering access platforms at our hire rates and delivery charges. (although some businesses in the U.K. can do okay if they balance their fleet mix.)
Loxam I see differently and if they were successful, true, we would see some consolidation (including job losses) and maybe this would result in improved rates but somehow I don't think so.
So my vote would be TVH.

Dec 17, 2016

From what Ive read TVH will be a far more safer bet, Loxam are french owned and only think of themselves and france first and foremost. By accepting the Loxam bid they will be putting many jobs at risk in the uk, TVH will just carry on as normal.

Dec 16, 2016

AccessibL
WHY-OH-WHY are the BoD recommending Loxam? Where-oh-where do their loyalties lie? Having built the company into such a strong position, why sell out to a market competitor who already has a dozen depots in this country, and jeopardise the jobs of the very people who put the work in to secure their Directors salaries? Do they want to become Directors of the even larger company? Is that the stake?
Vote for TVH, all the way! A huge company that has never needed to sell out will surely appreciate the efforts of the workforce far more than an outfit who make their profit for others, and will cull on demand and live for their figures.
Does my view need correcting?

Dec 16, 2016
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