KIRIN Holdings raised its tender offer price for Fancl by 4.1 per cent and extended its deadline for the bid to Aug 28, a potential concession to some investors who were concerned that the offer had undervalued the skincare brand.
The brewer, which is looking to reduce its reliance on beverages, made a bid in June to acquire two-thirds of Fancl that it does not already own and had extended the deadline once. The new proposal calls for buying out the smaller company for about 230 billion yen, at 2,800 yen a share, according to a filing on Tuesday (Aug 6).
Fancl shares were trading above Kirin’s prior offer of 2,690 yen a share even amid the recent broad decline in Japanese stocks, indicating that the market was expecting a higher bid. Kirin acknowledged the situation in its statement and raised its offer “to increase the certainty of the consummation of the tender offer.”
Fancl shares closed at 2,767 yen in Tokyo on Tuesday.
My.Alpha Management HK Advisors, a Hong Kong-based hedge fund, recently increased its stake in Fancl to around 8 per cent from 5.1 per cent. Although the investor is unlikely to push for a higher price, its disclosure of a significant position may encourage other investors to step forward with their intentions to block the bid at the current price, people familiar with the matter have said.
Kirin, which initially took a stake in Fancl five years ago, made its tender offer on Jun 14 at a 40 per cent premium to Fancl’s closing price from the previous day. The beverage and beer company is facing pressure from the government to regulate healthy drinking habits. Kirin acquired Blackmores, an Australian vitamin maker, for about US$1.2 billion last year. BLOOMBERG
