Nicosia, Cyprus. Cyprus Trading Corporation Plc is proceeding with a mandatory public takeover bid for Ermes Department Stores Plc after increasing its stake through the purchase of 17.5 million ordinary shares. The acquisition triggered the threshold for a mandatory public offer under Article 13 of the relevant law.
Stake purchase and offer trigger
Cyprus Trading Corporation said it bought 17.5 million ordinary shares, representing 10.029 per cent of Ermes’ issued share capital, from Department Stores Realisations Limited for a total of €127,758.43 at €0.0073 per share.
Before the transaction, Cyprus Trading Corporation directly held 117,240,047 shares in Ermes, or 67.186 per cent, while its total holding together with persons acting in concert stood at 67.774 per cent.
Following the acquisition, the threshold requiring the submission of a mandatory public offer was triggered under Article 13 of the relevant law.
Offer terms and current shareholding
The offer relates to the acquisition of up to 100 per cent of Ermes’ issued share capital, with Cyprus Trading Corporation proposing to pay €0.014 per share in cash to shareholders who accept the bid.
As of the date of the announcement, Ermes had 174,499,710 ordinary shares in issue.
Cyprus Trading Corporation now directly holds 134,740,047 shares, representing 77.215 per cent of the voting rights, while its total holding together with related parties stands at 77.803 per cent.
Funding and approvals
The company said it is making arrangements with a Cyprus credit institution to secure the funds needed to pay the consideration.
It added that the public offer is subject to the necessary approvals from the Cyprus Securities and Exchange Commission (CySEC) and is not conditional on any other regulatory clearances or conditions.
Because the offeror already controls more than 50 per cent of the voting rights, the bid will be regarded as successful regardless of how many additional shares are tendered.
What factors will you consider when deciding whether to accept the €0.014 per share offer?