Down to the wire at TPG’s InvoCare takeover
Much ado about nothing at InvoCare, the listed funeral home operator currently in the sights of private equity giant TPG.
After a bit of back and forth, InvoCare and TPG signed an agreement on May 15 at a $13 per share offer price. Discussions have been ongoing since that time to get a final agreement over the line. So far, no luck, although sources close to the ASX-listed group suggested it could be signed within days.
InvoCare runs the White Lady Funerals and Simplicity Funerals brands, and has a market capitalisation of around $1.78 billion.
Australia’s death rate has fallen in the last year, according to the Australian Bureau of Statistics Nick Moir
InvoCare has given TPG two one-week extensions to the exclusive negotiation period this month, providing no details for the delay. Exclusivity ran out on Tuesday, at which time InvoCare simply told shareholders that the two parties were still “continuing to work toward an entry into a scheme implementation deed”.
The latest update – unlike those sent to shareholders on July 4 and July 11 – omitted guidance that “TPG had reconfirmed on a regular basis the Revised Proposal to InvoCare”. That sent shares down almost four per cent.
Investors must be anxious. InvoCare shares last closed at $12.41, below the $13 takeover price that was proposed by TPG. Since May 15, shares in its smaller rival, Propel Funeral Partners, have fallen around four per cent. Overlaid on InvoCare, that would put it at around $12.35 per share. And death rates, one indicator for its earnings, are falling, down 6.6 per cent year-on-year, according to the latest Australian Bureau of Statistics figures.
TPG is being advised by UBS, Jarden and Gilbert+Tobin, while InvoCare has engaged Goldman Sachs, Gresham
Read more on afr.com
