Raphael Geminder’s improved offer price to Pact shareholders has taken him a significant step nearer to assuming full control of the company, and delisting it.
Geminder’s new ‘final’ 84c a share proposal, made through his Kin Group, has won the approval of the Pact board, which is now recommending acceptance, and whose directors have now sold their shares. Pact’s other major shareholder, Investors Mutual, has also now sold.
The Kin Group currently has 82 per cent of the Pact company, up from the 50 per cent it owned prior to the offer, and has given the remaining shareholders a deadline of 12 February to accept the offer. Geminder is aiming to take the Pact Group off the ASX and put it back into private hands.
The new 84c a share offer is a significant upgrade on the initial 68c a share, and values the company at $289m, although it was valued at $480m just last year.
Prior to the new offer Pact shares had fallen by more than a third in the past 12 months, down by 34.5 per cent to 69c before the new offer, following which they shot up to 84c. They have fallen in value by four fifths over the past five years, worth only 21 per cent of their 2018 value.
Revenue for Pact for the 12 months to June was up by six per cent to $1.95bn, but underlying net profit fell by 40 per cent to $45m, with a statutory loss of $7m posted.
Pact was formed by Geminder 20 years ago when he bought several underperforming Visy businesses and bolted them together. Current managing director Sanjay Dayal joined from BlueScope Steel four years ago.
Should Geminder’s plan be realised his family will own a sizeable chunk of Australia’s packaging capability. He will own Pact, he already owns 66 per cent of Pro-Pac packaging, and his wife Fiona is the sister of Visy executive chairman Anthony Pratt. Geminder is himself worth $1.3bn, according to the AFR Rich List.
