The consortium, which also comprises TFI Asset Management and GA Technologies, has proposed to purchase all the outstanding shares of Hollysys at $29 per share in cash, which is 9.4% higher than the previous offer by the Recco-Dazheng consortium
Dazheng consortium to acquire Hollysys for $1.8bn. (Credit: Rock Staar on Unsplash)
A consortium led by Dazheng Group has increased its offer price to acquire China-based automation control system solutions provider Hollysys Automation Technologies, for a total of around $1.8bn.
The consortium, which also comprises TFI Asset Management and GA Technologies, has proposed to purchase all the outstanding shares of Hollysys at $29 per share in cash.
In August this year, a consortium led by Recco Control Technology and Dazheng Group made an offer to purchase all the shares of Hollysys at $25 per share in cash.
The China-based automation technology company has also received several other offers.
In October, Hollysys appointed a committee to consider a $1.55bn takeover offer from the Recco-Dazheng consortium, along with other offers.
In November, the Recco-Dazheng consortium revised its offer to pay $26.50 per share or $1.64bn for Hollysys, which is 6% higher than the consortium’s offer in August.
Dazheng’s current bid is 9.4% higher than its previous offer in consortium with Recco.
In addition, the offer is also 9.4% higher than a competing offer by Ascendent Capital Partners, a private equity investment company focused on China-related investments.
Dazheng said that the consortium is fully confident that its sweetened bid, at an attractive premium, and backed by credible financing, will be considered superior by the Hollysys Board.
Its revised proposal is backed by secured and credible financing, which is further strengthened by the inclusion of GA Technologies into the consortium.
Dazheng in its statement said: “The Consortium believes its newly enhanced proposal presents the Hollysys Board with the greatest opportunity to deliver immediate and significant value to its shareholders.
“The Consortium stands ready to engage with the Board and is prepared to swiftly commence confirmatory due diligence and enter into a merger agreement.
“With its new offer submitted, the Consortium has confidence that the Board will recognize the value this offer presents Hollysys shareholders and engage constructively with the Consortium to finalize this transaction.”
UBS Hong Kong Branch served as financial advisor to Dazheng, Sullivan & Cromwell and DLA Piper as US counsel to the consortium, while Conyers Dill & Pearman advised on BVI law.