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Colt shareholders grab Fidelity offer, declare 'we're outta here'
190 pence per share undervalues the business? Not on your nelly, mate
Reluctant telco Colt is edging closer to private ownership again, after a bunch of shareholders approved a 190-pence-per-share offer from private equity firm Fidelity to flee the loss-making biz.
Fidelity was already a majority share owner in Colt when it approached the LSE-listed cloud wannabe in June, with a bid that values the network services and telco firm at £1.73bn.
Top brass at Colt reckoned the offer undershot their estimates, claiming the financial terms of the offer were “not fair”. Clearly a number of shareholders disagree and want to realise their investment.
In a statement to the City today, Colt confirmed Lightening Investors – Fidelity’s bidding company – received “valid acceptances” for 27.5 per cent of the total shares, taking their stockholding to 89.9 per cent of issued share capital.
“The independent directors of Colt note that the offer has been declared wholly unconditional,” Colt said. “Fidelity has announced that it will procure that Colt will make a request to the UK Listing Authority and to the LSE for the cancellation of the listing.”
Colt dropped the 'Telecom' element of its brand some years back, as sales in the legacy voice business began to tumble. It set up a tech division and recruited some tech heavyweights from the IT channel to run it, including former Computacenter UK MD Simon Walsh.
Company turnover in 2014 was €1.495bn, down 1.5 per cent year-on-year, as an 18 per cent decline in the core telecom division could not be offset by the network services unit or the little-loved IT services arm.
More recently, in the six months to 30 June, Colt report a turnover at €790.8m – up 2.6 per cent year-on-year – as a network services growth of 4.5 per cent to nearly €434m fuelled the expansion.
Voice services fell nearly 29 per cent to €186.1m and tech services were down 11.2 per cent to €33.3m. Data centre services edged up 1.3 per cent to €57.5m.
The company reported a loss before tax of €13m, versus a profit before tax of €13.6m during the first half of the prior year. ®