Eureka, the only pure-play over 55s rental accommodation provider in Australia, has informed the ASX that Filetron, the business owned by Ben Cottle (pictured), the founder, primary shareholder and Non-Executive Chairman of the FDC Group of companies, does not intend to accept Aspen Group's takeover offer for all of the business.
In a significant development on Tuesday (19 March), Filetron increased its financial stake in Eureka to 19.29%. Just 24 hours later, Eureka told the ASX that the Board of Directors "has received written notice from Filetron Pty Ltd, which owns 19.29% of Eureka, it does not intend to accept Aspen Group Limited's unsolicited all-scrip takeover offer for all of the shares of Eureka..."
"On the basis of the statement by Filetron, Aspen will not be able to achieve the 90% threshold needed to compulsorily acquire all other Eureka shares not held by Aspen.
"Furthermore, scrip-for-scrip rollover relief is only available if Aspen becomes the owner of at least 80% of all Eureka shares. The 19.29% held by Filetron makes it highly unlikely that Aspen will meet the 80% threshold."
Filetron first bought a stake in Eureka on 23 February 2023, and has since dramatically increased its share of the company. Eureka said yesterday that Filetron will be a long-term investor.
Eureka again reiterated to shareholders that Aspen's takeover offer is "inadequate" and "materially undervalues Eureka" and not to take any action until an Independent Expert's report on Aspen's offer is released.
Aspen, which provides accommodation in residential communities, retirement villages and holiday parks, had offered a merger of 0.26 Aspen securities per Eureka share on 23 January 2024. Today (Friday, 22 March), Aspen sent its offer to Eureka shareholders.
Eureka, in its 1H24 Financial Result, said the proposed bid meant Aspen valued Eureka shares at 0.44. As of this morning, Eureka shares traded at 0.52, which represents an 18.2% rise in its share price since the original offer was made.
