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Coca-Cola Amatil shares outpace purchase offer, may spark renegotiations

Coca-Cola Amatil’s acquisition by Coca-Cola European Partners may have hit a bit of a snag – the Amatil’s shares are now worth more than what CCEP is offering, and analysts think the deal might fall through unless it revises its offer to match.

According to a report in AFR, Macquarie Capital analysts thinks Amatil shareholders might vote against the CCEP share offer now that their shares are worth $13.12, $37c above the scheme of arrangement.

Amatil revealed a fairly strong trading update last week, which spiked the share price due to renewed market confidence in the beverage company’s effort.

“CCEP’s indicative proposal price of $12.75 (less any second half 2020 dividends) appears low, given recent share price performance and an upbeat fourth quarter trading update,” Macquarie analyst Morana McGarrigle said, according to AFR.

Citigroup’s head of research, Craig Woolford, agreed, calling the offer “opportunistic”.

“We think the probability is rising that CCEP will need to lift it’s offer. We include a probability of 35 per cent that the takeover offer has a sweetener of 40c [to $13.15],” Woolford said.

According to the AFR, four Amatil shareholders have previously said they believed the offer was too low, undervalues the business, and that the board should return to the negotiating table.

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