The way is clear for Quinn Group's proposed €84 million bid to take over Barlo plc after the backers of the original management buyout (MBO) attempt withdrew their offer for the radiator and plastics manufacturer last night.
Melgan, the MBO vehicle led by Barlo chief executive Dr Tony Mullins, last month offered 40 cents a share or €70 million for the group.
But Quinn subsidiary Sarcon trumped that this week with the announcement that it would bid 48 cents, or €84 million. Barlo's independent directors, Mr Niall Carroll and Mr John Farrell, subsequently said they intended to recommend the Sarcon offer.
In a statement last night, Melgan said it noted Sarcon's cash offer and the independent director's intention to support it.
"In light of these events and with the consent of the Irish Takeover Panel, Melgan now announces the withdrawal and subsequent lapsing of its offer for Barlo," the statement said.
Melgan had received more than 34 per cent in irrevocable acceptances from shareholders for its 40 cent offer. That included 12.4 per cent of the company attributable to its own backers. Along with Dr Mullins, they included Mr Aidan Barlow and the Barlow family and corporate development director Mr Brian Beausang.
Barlo shareholders who have given irrevocable acceptances to Melgan are now free to accept Sarcon's offer or to sell the shares on the open market.
If Melgan had not withdrawn its offer, takeover rules would have required it to wait until the end of the first week in April before accepting a competing offer.
If the Sarcon offer is accepted, Dr Mullins and his family will be paid close to €2.75 million for the 5.728 million Barlo shares they jointly own. Mr Aidan Barlow will receive close to €2.5 million for his 5.162 million shares.
According to Melgan's offer document, Barlo has agreed to pay it €719,990 to cover third-party costs associated with its failed bid to buy the company.
Two Quinn Group subsidiaries, Quinn Direct and Quinn Group Family Properties, now control 29.95 per cent of Barlo. The group needs a further 50.05 per cent for its offer to become unconditional and succeed.
