Sanford board concedes

Sanford Securities’ board of independent directors is recommending all remaining shareholders acceptIWL’s offer to buy their stake in the company a week before the latter’s final extended deadline expires.

With no other bids emerging, the Sanford board has turned on its original recommendation for shareholders to reject the IWL bid of taking a 100 per cent stake in the company, and states “the 19 cent cash offer [by IWL] represents certainty of value”.

IWL has almost 60 per cent control of Sanford and may de-list the group once the number of shareholders required to maintain a listing falls below the minimum level set by the ASX, Sanford says in a statement.

IWL made clear its intentions to acquire board control earlier this week, a request that will now be granted.

During the bidding process, Sanford directors searched for more attractive offers, while also encouraging IWL to lift their offer, but to no avail.

Last Friday IWL’s stake in the group rose to 58.2 per cent largely due to the National Australia Bank (NAB) and a founding shareholder accepting the offer. This was a significant increase from only 24.2 per cent the previous Wednesday.

“Sanford’s shares are quoted on the ASX, trading volumes prior to IWL’s bid were generally low. Sanford’s remaining shareholders are now in the minority and liquidity in Sanford shares can be expected to be lower than before IWL’s bid,” the Sanford board says in a statement.

Sanford have therefore advised shareholders requiring liquidity to accept the cash alternative and those wishing to participate in the growth and potential upside of Sanford’s business should consider the IWL scrip alternative. It also warns shareholders who accept IWL shares that their shares will be subject to the volatility of the stock market and could trade below the 19 cent cash alternative.