GREENOCK-BASED British Polythene Industries is poised to change hands after its board recommended a £261 million takeover bid by packaging company RPC Group, valuing BPI chairman Cameron McLatchie’s stake at nearly £8m.
Shares in BPI surged by more than 35 per cent after accepting the 470p per share offer.
But there is no immediate clarity on the immediate future of BPI’s operations in Scotland, where it employs about 350 people out of its global workforce of 2,200.
RPC’s Pim Vervaat, who said BPI had been on his radar since he became chief executive three years ago, said: “There will be an integration team of key RPC and also BPI personnel, including the chairman and CEO, to understand what makes sense of the combined entity. I think it’s a bit too early to say anything more than that.”
The sale of BPI comes 16 years after it after resisted a hostile takeover bid by Glasgow-based Macfarlane Group.
At the time Mr McLatchie, then chief executive of BPI, slapped down the Macfarlane offer as a “bargain-basement price” that undervalued the company.
It appears that resistance has paid off over the long term, with the RPC bid representing a 30 per cent premium on BPI’s Wednesday night closing price of 725p per share.
However, it does signal the exit of a major listed Scottish plc from the UK corporate scene.
The RPC offer values the 3.06 per cent stake held by Mr McLatchie at £7.96 million, while chief executive John Langlands’ 1.49 per cent stake was worth £3.9m. BPI employees held a 1.36 per cent shareholding in the company, valued at £3.6m.
RPC is looking to part-fund the acquisition by raising about £90m through the placement of new ordinary shares priced at 5p each, it announced yesterday.
Mr McLatchie, whose family also held a range of shareholdings in BPI, said: “The last five years have seen consistent improvements in BPI’s performance and prospects, but not all of this progress has been reflected in the price or rating of BPI’s shares.
“RPC has recognised the value inherent in our business and prospects by making an offer at an attractive premium to the share price. BPI’s business should benefit from the ability of a larger group to expand its footprint in Europe and beyond. Shareholders will benefit from enhanced liquidity for their investment, and employees will have access to the opportunities available in a larger group.”
Mr Vervaat underlined the attractions of the deal to RPC, and voiced his support for the current strategy being followed by the BPI board.
That has seen it offload its Chinese subsidiary for £9.7m to an Australian packaging group in April, and close manufacturing sites in Widnes and Sevenoaks south of the border, in 2015.
BPI, which makes polythene and stretch wrap for the retail, agricultural and other sectors, has also been investing heavily in its operations. Last year it invested a £5m spend to upgrade its site in Ardeer, Ayrshire, which was part of a planned £20m spend to enhance its factories.
Mr Vervaat said: “We will look at the current management intentions and plans. In the main, we think the BPI board had a sensible strategy, which we will look to enhance.”
He added: “It’s two good British companies joining forces, and I think together we could do more than if we were separate.”
BPI reported a four per cent rise in pre-tax profit to £23.1m last year despite a six per cent fall in revenues to £468m. RPC booked pre-tax profits of £75.6m in 2015 on turnover up 34 per cent to £1.6 billion.
Shares in BPI closed up 35.2 per cent at 980p while RDC shares closed up 3.4 per cent at 843p.
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