Gro-Aust is currently the majority shareholder of Tranzact, with a relevant interest in 60.4 per cent of the company’s ordinary shares.
The takeover bid comes after Tranzact sold its struggling self-managed superannuation fund administration business to 49 per cent AMP-owned SuperIQ in October.
In a letter to Tranzact shareholders, Gro-Aust chairman Paul Foley made an offer of 12 cents cash for each Tranzact share.
Mr Foley pointed out that no competing offers are likely given that Gro-Aust currently owns 60.4 per cent of the company.
The offer represents a 33 per cent premium on the 9 cents closing Tranzact share price on 5 November, and a 30.6 per cent premium on the six-month volume-weighted average price of Tranzact shares up to and including 5 November, said Mr Foley.
The closing price of Tranzact’s shares yesterday was 10.5 cents.
Whether the Gro-Aust offer is accepted, Mr Foley said Tranzact “should not be allowed to continue to incur significant costs associated with its listing on the ASX”.
“Its remaining business is too small to be sustainable in the longer term and Gro-Aust, as the majority shareholder, sees limited prospects to profitably expand the business,” said the letter.
Shareholders who do not accept the offer should “consider the implications of being a minority shareholder in Tranzact in a context where there has been a lack of liquidity in Tranzact shares”, Mr Foley said.
In response to the takeover bid, the directors of Tranzact announced to the ASX yesterday they had formed a committee to consider the offer, and had appointed TC Corporate Pty Ltd to act as a financial adviser – along with an independent expert to provide a report to shareholders.
“In the meantime, shareholders should take no action with respect to their Tranzact shares,” the statement said.
