Redflex chair “disappointed” by merger rejection

Redflex chair “disappointed” by merger rejection

Redflex (ASX:RDF) chaiman Max Findlay is “disappointed” that shareholders did not approve a $2.75 per share takeover offer, but said its business has not been affected by the decision.

The takeover bid for the traffic camera technology company submitted by Macquarie Capital and the Carlyle Group failed to gain the required approvals at a shareholder meeting earlier this week.

In a letter to shareholders sent out on Friday, Findlay said the board was “disappointed that the requisite majorities for the scheme were not obtained.”

He pointed out that the revised offer is now worth $100 million more than the company's valuation based on its current share price, which fell by around 80 cents after the results of the vote were disclosed.

He also reiterated that no superior proposal had been received since the original offer was made.

But Findlay said that the sale process has had no effect on the underlying Redflex business in terms of operations, and that Redflex had signed a number of major new contracts in Australia and internationally over the last 18 months.

Redflex on Friday separately disclosed that the company has resolved its dispute with American Traffic Solutions, and as a result the two companies have dropped their respective lawsuits.

American Traffic Solutions, which is a key Redflex rival, had last year been rumored to be preparing a competing takeover bid for the company but nothing came of it.

RDF shares stayed flat on Friday at $1.850.

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Tags Macquarie Capitalcourt actionASX:RDFMergers and acquAmerican Traffic SolutionsMax Findlay

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