The largest ever takeover of an Irish public company is expected to be announced next week with the sale of Woodchester Investments for about £600 million. Woodchester will report first-half results in the middle of the week and the company is expected to announce that the long-running negotiations on the sale of the leasing operation have concluded.
GE Capital, the finance arm of the giant US General Electric Company, which has been seen as the front-runner to take over Woodchester, is understood to have finally reached agreement on price. Other bidders involved in the final stages have included Ford Credit, the finance subsidiary of the car company and the second largest leasing company, AT&T Finance and Standard Leasing.
The sale of the company was announced in March when Woodchester and its French parent, Credit Lyonnais, appointed advisers to seek bids. A tough negotiator, GE is understood to have taken a back seat at an early stage of the negotiations, possibly on the basis that if significant other bidders did not come into the frame, the price could be pulled down. However, a late entrant into the frame - a US leasing group - meant that the price pressure was maintained.
GE Capital will have to pay about £600 million for Woodchester, a price of 265p per share. Woodchester shares closed yesterday at that price, up 5p on the previous closing price.
The deal has had to be approved by the French government, which owns the troubled Credit Lyonnais bank which, in turn, has a 54 per cent stake in Woodchester. Reporting a sharp rise in Credit Lyonnais first-half profits yesterday, chairman, Mr Jean Peyrelevade said the bank expected to conclude the sale of Woodchester by the end of the year. Potential purchasers are understood to have sought an irrevocable acceptance from the French government before any sale was announced.
GE Capital has been seen as the favourite to acquire Woodchester from the beginning. The US subsidiary of General Electric has been expanding rapidly in Europe. Woodchester has interests in Ireland, Britain, Portugal and Denmark.
Chairman and chief executive, Mr Craig McKinney, is expected to announce first-half pre-tax profits of about £24.5 million and earnings per share of 8.5p next week.
