The board of Marston’s has rejected three offers from US private equity house Platinum, it revealed on Monday, days after unveiling that a potential bid was on the table.
Directors said they believed that a £666 million bid “significantly undervalues” the pub and brewing business.
The 105p per share bid also followed two other bids, at 88p and 95p, which were tabled by Platinum Equity Advisors in December.
The business’s shares had been trading at around 83p before the news that the bid had been rejected was released on Monday afternoon.
Shares rose around 3% to 85p after the announcement. But they are still a long way off where the company started last year, something which the board highlighted.
“The (105p) proposal represents a 19% discount to the company’s share price at the start of 2020, pre-Covid 19,” it said, highlighting changes to the business since then that have been made alongside the forced changes of Covid-19.
During a challenging year the business merged its brewing arm with Carlsberg UK, forming a joint venture worth around £780 million. Marston’s has a 40% stake in the business.
The board on Monday said that this deal “realised significant value on completion and is anticipated to continue to do so as the benefits of the joint venture are realised.”
The company also agreed in December last year to take over operations of more than 150 Welsh pubs from SA Brain.
The company said: “The board of Marston’s has considered the proposal of 105 pence per Marston’s share with its advisers, and unanimously rejected the Proposal on the basis that it very significantly undervalues Marston’s.
“The proposal followed two earlier proposals at 88 pence and 95 pence per share in December 2020, both of which were received prior to the Brains transaction, and were unanimously rejected by the board.”
Last month Marston’s revealed an enormous drop in revenue for its Christmas trading, with revenue dropping by nearly £1 billion compared to the Christmas before, to £54 million.