Bid launched to take Tangent private
Wednesday, February 10, 2016
Former TV mogul Michael Green is backing a £6.7m bid to buy back Tangent Communications and take the struggling print PLC private.
Green’s nephews, Tim and Nick Green, are currently chief executive and executive director at Tangent. Nick Green runs its Printed.com operation. Michael Green is the group's non-executive chairman.
Tim and Nick Green, together with chief financial officer Jamie Beaumont, have launched the buyout bid through newly-incorporated company Tangent Holdings UK, which is described as Bidco in the filing to avoid confusion.
Portland Asset Management (UK), which is wholly owned by Michael Green, is providing a £7m unsecured loan to fund the deal.
The share price fell to a 52-week low of 1.74p in November and subsequently fell further, to 1.25p.
The offer document stated that Bidco and its management believed that a turnaround in performance at the £26.25m turnover group “may take some time to become apparent” and the costs of being a PLC had become onerous.
“Bidco and its management believe that Tangent’s ongoing development is more suited to private ownership than a public market quotation with the emphasis on achieving short-term forecasts,” it said.
Bidco also stated that it did not intend to change the firm’s strategy and the buyout was not likely to result in job losses or site closures.
Tangent employs around 300 staff and owns web-to-print business Printed.com, property market print specialist Ravensworth in Newcastle, London-based high-end creative print operation T/OD, and marketing agency Tangent Snowball.
The offer price of 2.25p a share has been recommended by Tangent Communications’ independent directors, and has been accepted by directors and shareholders holding circa 55.51% of the issued share capital.
It represents a 35.77% premium on the firm’s average share price over the past three months and values the business at £6.69m. The 52-week high was 4.89p.
Michael Green is the largest individual shareholder in Tangent, with a stake of just under 30%.
The bid values the entire group at a third less than the £10.2m Tangent paid to acquire popular business card web-to-print firm Goodprint three-and-a-half years ago.
Almost a decade ago Tangent attempted to launch a £282m bid for St Ives.
If the bid goes through, Tangent executive director Kevin Cameron, who runs the Ravensworth business, will resign as a director but will continue in his current role. Non-executive director Nigel Kissack will resign as a director.
Tangent’s share price went up 1.03p to 2.4p on the news.