SYDNEY: APM Human Services International received an A$1.28bil (US$841.09mil) buyout offer from US private equity firm Madison Dearborn Partners and said it expects lower earnings this year, sending its shares down 30%.
Madison Dearborn, which already owns more than a 29% stake in the company, offered to acquire the rest for A$1.40 per share, a 14.1% discount to APM’s last closing price on March 26 and lower than previous suitor CVC Asia Pacific’s final offer of A$2 apiece.
The development comes after private equity firm CVC Asia Pacific failed to finalise its A$1.83bil takeover offer for APM at the end of a four-week exclusivity period.
CVC had sweetened its proposal to A$2 per share after APM rejected the private equity firm’s initial A$1.60 apiece offer, citing that the bid did not “sufficiently reflect its fundamental value”.
APM said the offer price under Madison Dearborn’s offer was “disappointing”, adding it intends to engage with Madison Dearborn and any other interested parties to determine if a proposal can be put to shareholders.
The company said it expects underlying net profit after tax and before amortisation for the financial year 2024 between A$95mil and A$105mil, lower than the A$178.2mil posted last year.
“Our Employment Services business is operating in an environment of extended low levels of unemployment, reducing client flows and requiring increased support to achieve sustainable employment,” APM said.
The firm said it expects incremental earnings growth in the financial year 2025 through contract awards and corporate initiatives.
Separately, Australia’s Westgold Resources said on Monday it had agreed to acquire Toronto-listed Karora Resources in a cash-and-stock deal worth about A$1.23bil (US$808.36mil), seeking its gold assets in Western Australia.
The deal will propel the combined group to become a mid-tier gold miner, producing around 400,000 troy ounces of gold a year in the state with a market capitalisation of around A$2.2bil. — Reuters