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Bloomberg
Steinhoff International Holdings NV said it won’t raise its offer for French electronics retailer Darty Plc, handing victory to GroupeFnac SA after a protracted auction.
Steinhoff’s offer of 160 pence a share in cash is final and won’t be increased, the South African company said in a statement on Wednesday. Fnac raised its offer to 170 pence a share earlier this week and said Tuesday it now speaks for 51.8 percent of Darty shares. Fnac rose 1.6 percent at 9 am in Paris. Darty fell 0.4 percent to 168 pence and Steinhoff rose 0.4 percent.
“Steinhoff’s pursuit for retail consolidation looks like it will take a pause for breath,†Exane BNP Paribas analyst Graham Renwick said in a note. “While we believe the Darty deal had strategic merits and would have created value for Steinhoff below 160 pence, their decision to walk away reflects strong capital discipline.â€
The announcement ends an auction that started last month when Steinhoff sought to disrupt Fnac’s plans to acquire its rival. Since then, the suitors have slugged it out, each increasing their offers several times, sometimes within minutes of each other. Fnac’s latest offer values Darty at 914 million pounds ($1.3 billion).
Fnac’s latest bid includes a partial share alternative of 1 share for every 25 Darty shares. The French retailer may need the deal more than Steinhoff as it has fewer alternatives for consolidation.
By combining, the retailers would get cost savings and additional sales of at least 130 million euros ($147 million) annually, Fnac has said.
The auction began last year when Fnac made a proposal that Darty rejected as being too low. It came back with a bid of 101 pence a share,
and got Darty’s board to agree at 116 pence. Steinhoff crashed the party in March with an offer at 125 pence
a share.