Caltex Australia has rejected EG Group’s $3.9 billion takeover bid, after determining the offer undervalued the business and doesn’t represent a compelling offer for Caltex shareholders.
The Caltex board will continue to engage with EG Group moving forward, however, in an effort to further acquisition talks between the companies.
EG’s offer was submitted following a third and final offer made by Canadian convenience store operator Alimentation Couche-Tard (ATD) of $8.8 billion.
Prior to the offer Caltex had also said ATD’s prior offers undervalued its petrol business, and that it would share further information with the company in order to come to a more suitable offer.
The offers of acquisition have impacted Caltex internally, with the business unable to replace outgoing CEO Julian Segal in time for his exit on Monday. While the search remains ongoing, CFO Matthew Halliday will take up an interim-CEO position.
In an update to shareholders Segal described 2019 as a tough year, with the ongoing softness in the economy, paired with weak retail margins, impacting the bottom line.
Profit on a historical cost basis fell 31 per cent during 2019 to $382.8 million, down from $560 million the prior year.
“Despite this, the underlying performance of our business has been resilient and we have continued to build on the solid foundations we have in place for future growth,” Segal said.