MTF rejects recent offers

Motor Trade Finance (MTF) has determined that recent takeover offers are not viable. MTF conducted a market testing process and received indicative proposals to acquire the company, however it has announced that none had sufficient merit to develop further and put to shareholders for approval. Late last year, Heartland New Zealand Limited expressed an interest in acquiring MTF as a consequence of Turners Limited making an offer for up to 20 per cent of the ordinary shares of MTF. The offer from Turners, an existing MTF shareholder, resulted in it increasing its holding to close to 8% of the ordinary shares. In response to Heartland’s initial approach, the MTF board stated it would not approve Heartland holding 10-20 per cent of the ordinary shares. Heartland signed a confidentiality agreement in October 2015 and, since that time, had continued to undertake limited due diligence to help it decide whether to make a full takeover offer. However, despite the market-testing process being initiated in response to several unsolicited approaches from a number of parties in recent years, no takeover is imminent. MTF said in a statement: “While the Board has never had a need or desire to actively seek a sale of the business, it has been willing to engage with these approaches in the interests of its shareholders. Responding to these approaches has been a significant distraction for the Board, management, staff, shareholders and our originator network. “The varied nature of the different non-binding, incomplete and confidential proposals, the diverse understanding of the unique MTF business model and the different levels of progress made with the various counterparties also prolonged the development and evaluation of those proposals. “It was stressed throughout the process that the board did not have a preference for a sale of MTF. The primary focus was on bringing the extended period of engagement on potential proposals to a close, whether that culminated in an offer being put to shareholders or not. “The process resulted in only one indicative proposal being received to acquire all of MTF. MTF also received indicative proposals to acquire a cornerstone shareholding of up to 20% of the ordinary shares. “In regard to the proposals to acquire a cornerstone shareholding, the board notes that it was not seeking such proposals and is of the view that those cornerstone shareholding proposals are not currently in the best interests of MTF and its shareholders. “The market testing process has now concluded and the Board looks forward to focusing on developing and growing the MTF business and expanding our franchise and dealer originator networks.”