MADRID, 7 May. (EUROPA PRESS) –
This Tuesday, Applus made an update of the business corresponding to the first quarter to “simplify it” given the war of public takeover bids (OPA) for the company launched by Amber and Apollo.
As reported by Applus to the National Securities Market Commission (CNMV), the results in the quarter have been “good”, with growth in both total and organic income “at a high single digit and with an improvement in the operating profit margin “.
The company has stressed that the outlook for the full year remains as announced in February 2024, with organic revenue growth at constant exchange rates “in the mid to high single digits” and an improvement in the adjusted operating result margin which will place it around 11.5% before the accelerated amortization of Idiada.
The takeover bid by the ISQ and TDR funds on Applus through their joint venture Amber, worth 12.78 euros per share, was finally higher than that of Apollo (12.51 euros per share), its rival in this process .
“For I Squared (ISQ), Applus is an extremely attractive asset. We look forward to working with the management team in the coming weeks and months to ensure a smooth transition,” highlighted ISQ’s senior partner, Mohammed el Gazzar, a few days ago.
For his part, TDR managing partner Gary Lindsay stressed that his firm focuses on investing in “companies with long-term growth opportunities”, such as Applus.
Recently, the CNMV imposed certain limitations on the funds that sold 21.85% of the company to Apollo (which launched its takeover bid for Applus through its instrumental company Manzana Spain BidCo) in the early stages of this year.
Among the measures adopted by the CNMV is the prohibition on these funds from acquiring more Applus shares at a price higher than 12.51 euros with the aim of avoiding distortions in the market through an “anomalous operation” that would be focused on facilitating The lowest priced takeover bid, Apollo’s, is imposed based on the economic interest that these funds have in Apollo’s proposal triumphing over Amber’s.
This is because in the share purchase contracts that Apollo signed with these funds there are various clauses that could cause this “anomalous operation”, of which the CNMV has “indications, although no evidence.”
At the beginning of last February Apollo completed the acquisition of 21.85% of Applus at a price of 10.65 euros per share after signing various share purchase agreements with the funds RWC Asset Management, Harris Associates, Maven Investment Partners, Samson Rock Capital, Sand Grove Capital, TIG Advisors, The Segantii Asia-Pacific Equity Multi-Strategy Fund, Melqart Asset Management, Millenium Partners, Man GLG Event Driven Alternative and Boldhaven Management.
These contracts contain compensation clauses (called ‘earnout’) for the funds that sold their shares to Apollo and which stipulate that if Apollo’s takeover bid is ‘successful’, the funds that signed these purchase and sale contracts will receive 12.51 euros. per share instead of the 10.65 euros initially signed, because the final proposal raised by Apollo on Applus last Friday was 12.51 euros (1.86 euros per share more than the initial 10.65 euros per share ).
However, there is another clause (called anti-embarrassment) that stipulates that if the ISQ and TDR takeover bid (of 12.78 euros per share) were finally imposed and Apollo decided to sell its 21.85% to ISQ and TDR, the funds Those who signed those purchase and sale agreements with Apollo would only receive 75% of the difference between the 10.65 euros at which they sold their participation to Apollo and the 12.78 that ISQ and TDR propose, that is, their additional profit would be 1.5975 euros per share, instead of 1.86 euros.
Another reason why these funds are interested in the success of Apollo’s takeover bid is that there is another scenario that contemplates that, if the ISQ and TDR takeover bid were finally imposed and Apollo decided to maintain its participation in Applus, the funds with the that Apollo signed the aforementioned purchase and sale agreements would not receive any additional profits.
For all these reasons, the CNMV issued a series of limitations in order to avoid distortions in the market.
For its part, Apollo explained that the purchase and sale contracts with the sellers of Applus shares were made public in their entirety in the corresponding prospectus supplement approved by the regulator on February 2. “In this sense, as in the rest of the process, the offeror considers that it has been transparent at all times with the market and the CNMV,” he stressed.
