The Warehouse Group has announced it will not be progressing talks with founder Sir Stephen Tindall and Australian investment manager Adamantem over a proposed takeover.
In July, the struggling group issued a “don’t sell” notice after it had received an approach from Tindall and Adamantem.
Sir Stephen started The Warehouse in 1982 and was managing director until 2001. He owned around 27% of the company, while the Tindall Foundation owned about 21%.
In a statement to NZX today, The Warehouse Group chair Dame Joan Withers said: “The current Scheme of Arrangement doesn’t have the critical shareholder backing it needs to proceed.”
The statement said a key shareholder had informed the board that they did not support the current terms, meaning the 75% approval from shareholders in each class was not possible.
Dame Joan said the board had decided to “defer further talks until such time as the proposal receives wider shareholder support".
“We acknowledge the interest from Adamantem Capital and the backing from Sir Stephen Tindall, however, without broader shareholder support, it is not prudent for us to pursue this proposal further.
“We’re committed to acting in the best interest of all our shareholders. While the board has not yet formed a view on value, we’re open to continue discussions if a further proposal generates shareholder support sufficient to make its execution viable.”
The indicative proposal included a proposed price in the range of $1.50 to $1.70 per share.
It comes amid a tough period for the retail group, which has focused its efforts on The Warehouse, Warehouse Stationary, and Noel Leeming.
Chief executive Nick Grayston left earlier this year, and the company is bracing for a drop in earnings.
Jobs are also on the line at its head office.
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