Apollo launches a takeover bid for 100% of Applus for 1,226 million euros in cash

The US fund is ahead of Apax and the consortium formed by I Squared and TDR in its interest in acquiring the company

The US fund Apollo has launched a public offer for the acquisition of shares (OPA) on 100% of Applus at a price of 9.5 euros per share in cash, which yields a total amount of 1,226.2 million euros, according to the documentation sent to the National Securities Market Commission (CNMV).

The consideration offered, backed by a bank guarantee for the same amount, represents a premium of 2.3% compared to the listing price of Applus shares at the close of the market on June 28, 2023, the last trading day prior to the presentation of the request for authorization of the offer (9.29 euros).

Likewise, said price represents a premium of 36.8% compared to the volume-weighted average trading price of Applus shares during the year prior to the presentation of the request for authorization of the offer (6.94 euros) and 24, 8% on the volume-weighted average trading price of the firm's securities during the semester immediately prior to the presentation of the request for authorization of the offer (7.61 euros).

The effectiveness of the offer will be subject, among other conditions, to a minimum acceptance of at least 96,805,600 Applus shares, representing its 75% of the share capital with voting rights.

SUPPORT OF THE BOARD AND EXCLUSION FROM THE PURCHASE

Likewise, the offer, which is subject to the relevant approvals by the Competition Authority as well as by the Council of Ministers, has the support of the Applus board of directors, which has expressed its commitment to cooperate with Apollo in relation to it. The US fund's intention is to delist Applus shares.

As reported to the CNMV by Apollo, which for the purpose of launching the takeover bid has established the instrumental company Manzana Holdco, the consideration will be adjusted downwards in the event that the company previously pays a dividend to its shareholders.

As an exception, Apollo has taken into account for the determination of the price of the offer the dividend approved by the general meeting of Applus shareholders on June 8, 2023 at 0.16 euros per share (that is, for a maximum amount of 21 .73 million euros) that will be payable on July 6, 2023.

Consequently, the price of the OPA will not be adjusted downwards as a result of the payment of said dividend.

Despite being a voluntary takeover bid, Apollo plans to provide a valuation report prepared by KPMG Asesores as an independent expert to ensure that the consideration is fair, something that the CNMV will have to ratify.

APOLLO TAKES THE FIRST STEP

The announcement of the takeover bid presented by Apollo on Applus, based in Spain, present in more than 65 countries and with more than 26,000 employees, has taken place in a context, since the start of the war in Ukraine and the rise in interest rates interest, in which the company has appeared in most of the pools of analysts as a candidate to receive a takeover bid that would exclude it from the stock market.

In this scenario, entities such as Apollo, the first to make a move, Apax and a consortium formed by I Squared and TDR would have been exploring the possibility of acquiring the company.

In this way, the certification company has been in the spotlight of several investment funds in recent weeks and has been the subject of different movements in its capital.

Specifically, these have been carried out by the German asset manager DWS Investment, by the US financial institution Morgan Stanley and by the funds Nekton Global Fund Limited, Millenium Group Management and Red Wheel European Focus Master Inc.