by Pascale Denis
PARIS (Reuters) – The board of directors of the Club Med, not surprisingly, recommended Monday enhanced Fosun bid, advising shareholders wishing to provide immediate liquidity their shares to the offer.
The Board unanimously agreed that the project of the Chinese conglomerate was the highest bidder financially and combined both the interests of shareholders and the company, with including “accelerating the strategic repositioning” of the group on the high-end villages, “increased in Asia (…) development and consolidation of its market share in mature markets.”
All of its members participating in the vote (the four administrators interested in offering Fosun who did not participate in the deliberations) agreed to tender their shares.
The board had already welcomed Second offer made on September 12 by Gallion Invest II, an investment vehicle controlled by Fosun, saying it allied “increase shareholder value and will continue and strengthen the strategy of the Club.”
More than a year after launching a first offer, Fosun has returned to battle after being defeated by the Italian businessman Andrea Bonomi.
Backed by the Group’s management he offers to buy Club Med at a price of 22 euros per share, instead of the 21 euros offered by the Italian, valuing the company at 839 million euros (860 million including debt.)
Contacted by Reuters, a spokesman Andrea Bonomi declined to comment Monday night.
In its statement, the Council welcomed the support of village leaders to Gaillon II project and attempts to reassure staff representatives who have a negative opinion on the project as too risky over the group under the Chinese flag and fearing the relocation of decision centers.
CRITICAL
Anticipating reviews, Fosun stressed its commitment to French roots of the club would remain headquartered in Paris, confirmed in office and the listing of the Company held at the Paris stock exchange management.
The Board therefore considers the project “likely to guarantee the identity of the club, the sustainability of its business, maintaining a stable shareholder structure and its policy on jobs.”
Blaming the publication by Press the mails received from Global Resorts (Andrea Bonomi vehicle) “likely to” adversely affect the image of the Club “, he also points out that the duration of successive bids, engaged since May 2013,” complicates the conduct of activities Club. “
After requesting updated financial data which it does not have access, Andrea Bonomi found in a letter dated October 3, the terms of the financing could Gallion II” increase pressure on the Mediterranean Club with the risk identified by employees to streamline the business, which would involve negative social consequences for employees at headquarters and villages. “
The Financial are also reiterated his criticism of a development strategy “without any commitment to the French and European market,” he assures that want to preserve the “France and Europe as a key asset of the Club.”
The market is betting meanwhile on a continuation of the battle and a new higher bid, the title exchanging Club Mediterranean since the last offer of Fosun, well above the 22 euros offered.
As of September 30, the hedge fund Boussard and Gavaudan was also mounted to 4.8% stake in the club. Fosun controlled in 18.3% and Strategic Holdings, the
desktop Andrea Bonomi, 9.90%. Value closed Monday at 22.45 euros, signing up 29.31% since the beginning of the year.
The proposed takeover was filed Monday with the Autorité des marchés financiers (AMF), which has now at least five days to issue its statement of conformity and, Following the new calendar.
(Edited by Matthieu Protard)
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