Huge Group has been forced to remove videos targeting Adapt IT shareholders, aggressively pushing them to accept its takeover bid.
The company raised the stakes this week in its effort to take control of the software services company, in a series of videos that discredited the offer of another Adapt IT suitor, Canadian software group Volaris.
Both Huge Group and Volaris launched separate attempts to take control of Adapt IT and this week competition intensified as Huge went on a direct offensive to conclude the deal.
Huge Group released two videos urging shareholders to reject the Volaris offer and consider its bid, prompting Adapt IT to hit back, cautioning investors not to be coerced into making a decision.
However, yesterday, Huge Group was forced to remove the videos from its Web site and retract the content thereof.
In a statement to shareholders, Huge said it had been notified by the Takeover Regulation Panel (TRP) that the videos constitute “announcements”, in respect of which approval from the TRP ought to have been sought prior to publication.
“Accordingly, Huge has removed the videos from its Web site and retracts the statements they contain.
“The board accepts responsibility for the information contained in this announcement insofar as it relates to Huge. To the best of its knowledge and belief, the information contained in this announcement is true and the announcement does not omit anything likely to affect the importance of the information.”
Huge Group launched its Adapt IT takeover bid in January, offering a swap ratio of 0.9 of a Huge Group share for every one Adapt IT share.
The swap ratio is based on a reference price of 613c per Huge share and an implied price of 552c per Adapt IT share.
The company says it is offering 33% premium on the shares.
Three months later, Volaris joined the race to take control of Adapt IT, offering to acquire more than 50% of the issued ordinary shares of Adapt IT for 650c per share.
According to Adapt IT, the Volaris cash consideration represents a premium of 56.9% to the 30-day volume weighted average traded price of Adapt IT shares on the JSE of 414c, as at 26 January 2021, being the last trading date prior to the date on which the general offer by Huge Group to Adapt IT shareholders was announced.
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