Just over 79pc of shareholders vote in favour
Shareholders of Irish Continental Group (ICG) approved a management buyout of the company at an extraordinary general meeting in Dublin today.
The offer of €8 a share, which valued the company at €1.2bn, was made by long-standing chief executive Eamonn Rothwell and three senior managers.
The deal had been opposed by several minority shareholders, who argued that the valuation was too low, and some of whom complained about the process being staged mainly through the traditional holiday month of August.
The original EGM was set for August 28, but was postponed for almost two weeks to give shareholders more time to consider the offer. On the basis of proxy votes filed in advance of the postponed meeting, independent directors said that the MBO was set to fail.
The media was not allowed access to the EGM, which began at 10am in a Dublin hotel. The outcome was described as too close to call by several sources close to the proceedings in the run-up to the vote. This was partly because the intentions of a number of key shareholders were unknown. These included Eamon Waters’ investment vehicle Sretaw, which has a 5pc stake in ICG.
The share price of ICG soared in morning trading on the Irish Stock Exchange, in advance of the result of the vote being announced. By noon it was up by 5.8pc to €7.70, an indication that the market expected the MBO to be approved.
Just before the result was announced at 1pm, the price reached €7.86, up almost 8pc since the opening.
The share price of the Irish Ferries’ operator stood at €6.24 on the day before the bid was announced in late July.
The management team bidding for the company held 23.7pc of the stock but were not allowed to vote. This meant the decision was taken by investors holding the remaining 76pc, with a high bar of 75pc of these needing to approve.
In the event, the vote in favour was 79.2pc, narrowly clearing the hurdle. The vote against was 20.8pc.
In advance of the vote, a group of minority shareholders holding about 11p of the stock announced it was voting against the bid. However it is thought that at least one significant shareholder changed its stance in the run-up to today’s vote, moving from a “no” to a “yes”, and clinching the deal.
Mr Rothwell, 71, has been the chief executive of ICG since 1992. Under the terms of the buyout, he and the management team will take €90m in cash off the table, with the remainder of their stake being rolled over into the new ownership entity.
The approval of the buyout – which has to be ratified by the High Court – means that the Irish Stock Exchange, operated by Euronext, will lose yet another company.