Digital marketing agency Mission Group has rejected a takeover proposal from rival Brave Bison, which valued the group at around 29p a share, compared to a closing price of 22.7p at the close of last week.
Mission said that on 29 April, it received an all-share unsolicited conditional proposal at an exchange ratio of 11.5 Brave Bison shares for each ordinary Mission share.
Based on the terms of the possible offer and the closing market prices of both companies on that date, the offer valued the group at approximately 29p a share.
“On 8 May 2024, the board of Mission, following consultation with its financial and legal advisers, unanimously rejected the possible offer which it believes to be opportunistic and significantly undervalues the group and its prospects,” the company said in a statement.
Mission added that an additional possible equity fundraising of at least £10m that BB is considering to accelerate debt repayment and strengthen the balance sheet of the proposed combined group would be further dilutive to its shareholders’ interests.
Mission’s share price has fallen over 70% in the past three years to a low of 10p last October after it issued a profit warning and cancelled its dividend in the face of difficult trading conditions.
Mission’s board further believes that the offer and resultant 45% ownership by its shareholders in the proposed combined group “does not fully reflect the inherent value” in the company, which it says has been “steadily improving” since the October profit warning.
