KLK's offer for MPE is 640p per share in cash, representing a 50% premium to the pre-bid closing price. In many bid circumstances this would likely be a knock-out blow, virtually guaranteeing success. However, in this case, all it serves to do is highlight the extreme under-valuation of MPE prior to the bid. In our view, KLK would probably have to increase its bid by another 50% to be offering something closer to the true value of MPE.
02 Nov 2016
The valuation genie is out of the bottle
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The valuation genie is out of the bottle
M.P. Evans Group PLC (MPE:LON) | 857 -34.3 (-0.5%) | Mkt Cap: 454.7m
- Published:
02 Nov 2016 -
Author:
Cavendish Research -
Pages:
12
KLK's offer for MPE is 640p per share in cash, representing a 50% premium to the pre-bid closing price. In many bid circumstances this would likely be a knock-out blow, virtually guaranteeing success. However, in this case, all it serves to do is highlight the extreme under-valuation of MPE prior to the bid. In our view, KLK would probably have to increase its bid by another 50% to be offering something closer to the true value of MPE.