Australian Food Super (AFS) has announced an on-market takeover offer for all remaining shares of Dynamic Group Holdings Limited (ASX:DDB) that it does not already own. AFS currently holds a 19.87% stake in DDB's fully paid shares. This proposed acquisition aligns with AFS's strategy to deploy capital in the interest of the Australian Meat Industry Superannuation Trust and to maximize long-term investment returns for its members.
Offer Details
The offer price is AU$0.28 cash per share, implying an equity value for DDB of approximately AU$38,931,172. This price represents a 19.15% premium to DDB's closing share price of AU$0.236 on July 25, 2024, the last trading day before the announcement. AFS believes the offer provides attractive value to DDB shareholders, especially considering the prevailing risks and uncertainties associated with continuing to hold DDB shares.
Rationale for the Offer
AFS has identified several risks impacting DDB's valuation, including business risks related to exposure to the mining industry and challenges in the labor market. These factors have contributed to a 14.55% decline in DDB's share price over the past 12 months. The offer allows shareholders who wish to sell their shares to receive immediate and certain value, with the cash consideration payable on a T+2 basis.
Offer Timeline and Broker Appointment
The offer period officially begins at 10:00 am (Melbourne time) on August 9, 2024. However, DDB shareholders can sell their shares to AFS at the offer price starting from the date of this announcement. AFS has appointed FinClear Execution Limited as its broker to stand in the market and purchase DDB shares at the offer price.
AFS's offer provides DDB shareholders an opportunity to exit their investment at a premium, reflecting AFS's commitment to maximizing value for its members. The transaction is also a strategic move for AFS, aligning with its long-term investment objectives.