A top asset manager has slammed a proposal to buy out minority shareholders at AltX-listed boutique hotel group Gooderson Leisure Corp.
In late July, Gooderson’s majority shareholder, the Alju Family Trust (named after Alan and Judith Gooderson), offered to buy out other shareholders at 65c/share. Though the buyout represents a premium to the pre-announcement share price average, the offer is pitched well short of Gooderson’s most recent stated tangible net asset value (NAV) of 157c/share.
Gooderson minorities are currently in limbo, with a delay in the issuing of the circular detailing the proposed buyout scheme.
In mid-September Gooderson indicated there had been a delay in the finalisation of the fair and reasonable opinion.
In a letter to the takeover regulation panel (TRP), well-known asset manager Dean Ginsberg, who holds Gooderson shares in his personal capacity, took serious issue with the effective offer consideration to minorities of R13.8m. He pointed out that Gooderson has been trying to sell two properties that would each raise enough money to pay out minorities. Ginsberg argued that the proposed sale would not only increase NAV, but also the group’s profitability, as the property is loss making.
"As far as I am concerned, when management [is] trying to delist a company at less than 42% of its audited and published NAV, it stinks of corporate/management abuse, especially given that management (and founding shareholders) own over 80% of the business," said Ginsberg.
He suggested the delay in the issuing of the circular was not surprising.
He added in his correspondence to the TRP that he would "like to put on record from my perspective that the ‘minority’ offer is neither fair nor reasonable, and any corporate finance house (or ‘independent’ valuation expert) that tries to justify the delisting price should be equally wrapped over the knuckles."