Health and skincare business McPherson’s received an unconditional cash takeover offer from minority shareholder Gallin today.
Currently, Gallin holds a 4.95 per cent interest in the business, but believes McPherson’s requires “urgent strategic and operational change” in order to stay afloat.
The offer, which represents a 9.8 per cent increase on McPherson’s share price at $1.34 a share, comes after a number of operational missteps at the business according to Gallin director Nick Perkins.
“McPherson’s is a business that has lost its way and is in urgent need of reinvigoration across its strategy, governance, and leadership,” said Perkins.
“The company’s performance has disappointed shareholders for some time despite owning a number of quality, attractive brands across key consumer markets. Now investors face a further extended period of uncertainty, including a lack of visibility on the current performance of sales of the Dr. LeWinn’s product range into China.”
The McPherson’s board, however, called the offer “utterly opportunistic”, and that it undervalues the brand. The board recommends shareholders ignore the offer.
According to Perkins, Gallin has the capital, capability, wherewithal and patience to turn McPhersons around, but ultimately it will be up to the business’ shareholders to decide on the next course of action.
Following the announcement, shares in McPherson’s jumped 13 per cent to $1.39 per share.