After months of stake-building Pittencrieff launched a formal bid in March. Pittencrieff's offer was in paper: two of its own shares for every 49 held in Aberdeen. When the bid approach was first made Pittencrieff shares were worth 356p, valuing each Aberdeen share at 14.5p.
Last Friday Pittencrieff issued a profits warning, announcing that its profits for the year to 31 December 1992 would be below expectations of pounds 5.5m. Pittencrieff shares sunk to 305p, making its paper offer for Aberdeen worth 12.5p. With the warning Pittencrieff also launched a 17p-a-share cash alternative.
Pittencrieff's results, published yesterday, emerged at pounds 4.5m. Both profits and sales were a good deal higher than in 1991 in absolute terms because of acquisitions. The earnings per share figure told the real story: earnings fell nearly 5 per cent.
Aberdeen's management promised that it would either find a white knight or it would break up and return assets to shareholders. Aberdeen management reckons net assets are worth 20p a share or more. A white knight may have appeared in the shape of Consolidated Venture Trust, which bought 15 per cent of Aberdeen on Friday.
Aberdeen shareholders have nothing to lose by spurning Pittencrieff. They should wait and hope CVT comes up with a better plan.Reuse content