The Bingo Industries Ltd (ASX: BIN) share price is going nuts, it’s up around 20% in reaction to a takeover offer.
Bingo is a fully-integrated recycling and resource management company, with a workforce of over 1,000 people and a fleet of around 330 trucks across New South Wales and Victoria.
Takeover offer for Bingo
Rask Media had already reported the rumour that Bingo had received a takeover offer. This morning, the waste management business has confirmed that news.
Bingo confirmed that it has received an “unsolicited, highly conditional” non-binding, indicative takeover offer from funds advised by CPE Capital (CPEC), on behalf of CPEC and its potential co-investors in a consortium including Macquarie Infrastructure and Real Assets (MIRA).
The indicative cash price offer for Bingo shares is $3.50 per share. There’s also potential for an alternative offer, which is under development, of a mix of cash and unlisted scrip/shares at a lower upfront price than the cash price, with the potential for higher consideration over time depending on certain earnings thresholds being achieved.
The proposal is subject to a number of conditions, including due diligence and finance.
Bingo’s board has set up an independent board committee, and discussions and due diligence with the consortium have been ongoing. However, the company said there is no guarantee that any transaction will result from the discussions.
The company also said that it would only enter into a transaction on terms that deliver on terms that deliver appropriate value for all Bingo shareholders.
Summary thoughts
Bingo shares have made up most of the difference, rising to around $3.30, so there’s only 6% left between the current Bingo share price and what indicative offer. However, there’s a chance there could be a bit more than 6% on the table if there’s another offer from a competing bid, or CPEC raise the bid a little after doing the due diligence.
However, there’s also the chance that CPEC walks away from the deal after doing due diligence, and there’s no competing bids.
To me, if I were a shareholder, I’d think this rise is enough to sell my Bingo shares and move onto other ASX growth shares like Pushpay Holdings Ltd (ASX: PPH).
