ARN Media Limited and Anchorage Capital Partners Pty Limited have today provided an update on their nonbinding indicative offer to acquire 100% of the fully diluted share capital of SCA.

ARN says under the Indicative Proposal, SCA shareholders would receive 0.753 ARN shares and 29.6 cents cash per SCA share.

“The Consortium remains open to working with SCA to structure part of the cash component of consideration as a pre-completion fully franked special dividend, which is expected to provide access to an additional value of 12.7 cents per SCA share from franking credits for eligible existing SCA shareholders.

 Following an initial period of due diligence engagement with SCA and its advisers, the Consortium has reconfirmed the Indicative Proposal to the SCA Board of Directors and has been granted a further period of due diligence engagement to access the required information to progress its confirmatory due diligence.

 The Consortium is also focused on progressing related transaction documentation in an efficient manner and, subject to the receipt of the required due diligence information, has an objective of delivering a certain proposal to SCA shareholders in early 2024.

 The Consortium remains confident that the Indicative Proposal represents a compelling value proposition for both ARN and SCA shareholders.

 The Indicative Proposal is subject to a number of conditions, including completion of satisfactory due diligence, transaction documentation and regulatory approvals. No binding agreement to implement the Indicative Proposal has been reached with SCA at this time and there is no certainty that a transaction will eventuate.

 The Indicative Proposal (and this announcement) is preliminary, incomplete, and non-binding and does not constitute a commitment or undertaking by the Consortium to proceed with the Proposed Transaction.”

ARN says it will continue to update shareholders as required.

In response, SCA recommends shareholders take no action in relation to the Indicative Proposal.

It says “The parties have not reached a binding agreement to implement the Indicative Proposal and have not agreed to commence preparation or negotiation of any transaction documentation. The Indicative Proposal is subject to several conditions, including satisfactory completion of due diligence currently under way, subsequent negotiation and execution of transaction documentation,
and regulatory approvals. There is no certainty that a transaction will eventuate.”

SCA says it, too, will continue to update shareholders as required.