The Office finished, but paper companies live on: Spicers to be acquired
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Two of the most popular UK and US sitcoms in The Office might have finished some years ago, but real-life paper companies live on.
Spicers, an ASX-listed paper distributor with a market cap of $109 million, is set to be acquired by Kokusai Pulp & Paper Co., a Japanese paper distributor which sold $4.8 billion worth of the stuff between April 2017 and March 2018.
Spicers (ASX:SRS) chairman Jonathan Trollip told investors late Thursday that though the board remained quite buoyant about the company’s prospects, the KPP deal represented an offer too good to refuse.
“Whilst the board remains confident in management’s plans for the Spicers business, and current results are showing positive momentum, the proposed transaction would provide considerable value for Spicers shareholders,” he said.
“The transaction consideration represents a significant premium to Spicers’ recent share price and would be paid as 100pc cash. The scheme is also subject to limited conditionality, with due diligence already completed by KPP.
“For these reasons, the board considers the proposed transaction to be very attractive to Spicers shareholders.”
The company’s shares are set to open up 9pc to 5.8c on the news this morning.
Under the terms of the deal, KPP would pay 7c per share, a 32pc premium to the stock’s 5.3c closing price on Thursday.
That works out to be a $147.6 million purchase price for Kokusai.
Spicers is unanimously recommending shareholders vote in favour of the deal.