British car part supplier TI Fluid Systems has rejected two offers from rival Canadian firm ABC Technologies, concluding they “significantly undervalued” the London-listed firm.
The FTSE 250 constituent, which specialises in fluid handling and operates nearly 100 manufacturing countries in 27 countries, confirmed in a statement that it had received a second “unsolicited, highly preliminary” offer from the Apollo-backed ABC Technologies.
The latest offer, made on September 4, valued TI Fluid Systems at 176p a share, a premium of 20.7 per cent to its closing price on September 13.
The two firms confirmed that the second bid was an improvement of 10p a share on ABC Technologies’ original bid, which was made in August.
But the TI Fluid Systems board concluded “unanimously” that the second, improved offer still “significantly undervalued” the company and its prospects.
Despite the rebuff, ABC Technologies remains interested in pursuing its interest. In a statement the company said: “ABC Technologies remains interested in a possible transaction, and is therefore considering its options.
ABC Technologies, a Canadian distributor of electronic components, has been backed by the private equity giant Apollo Global Management since 2021, which holds a majority stake in ABC.
ABC now has until October 12 to announce a firm intention to make an offer for TI Fluid Systems under the UK’s takeover rules.
Should an offer be accepted, the bid would represent another blow to London markets after a tumultuous 2024.
Listed firms’ stubbornly low valuations have led to a flurry of high-profile offers, takeovers, and de-listings as private equity or better-capitalised and higher-valued foreign rivals look to pick off cheaper UK firms.
Separately, the company issued a trading update warning on growth for the year. The company said it is “experiencing operational efficiency issues in two sites which is impacting both revenue and profitability.”
As a result of these headwinds and a lower-than-expected order uptake at its components business, the company said it expects operating profit to be around £13m for the year, £18m lower than initially expected.