STOCKHOLM, Sweden- The board of directors of Stiga Intressenter AB has made a SEK1.247 billion (US$149.5mn;EUR144.9mn) offer to buy out the shares of Monark Stiga, the holding company that comprises bicycles and gardening products, Monark Exercise and Monark Motor. Stiga Intressenter would therefore acquire more than 90% of the share capital and voting rights in Monark Stiga, a consortium headed by UBS Capital. The new company, Stiga Förvaltning AB, will be established by UBS Capital (51%), the Grimaldi Industri AB and, to a lesser extent, the business area's management group.
UBS Capital is a private equity operation with a global presence. Its network covers over 30 countries in Western Europe, the Americas and Asia Pacific. UBS Capital is an integral part of UBS a publicly traded shareholder-driven financial company incorporated under Swiss laws and with head offices in Zurich and Basel.
If Stiga Intressenter AB acquires the necessary shares of Monark Stiga, Grimaldi Industri will become owner of the bicycle business area and Monark Exercise. The operations of Monark Motor will be discontinued. Presently, Stiga Intressenter is a wholly owned subsidiary of VenCap Industrier AB in which Grimaldi Industri is a major shareholder. VenCap has undertaken to tender its 71.7% of the share capital and voting right. Institutional owners, together holding 9.8% of share capital and votes, are in favor of the offer.
The shareholders will decided on the offer on 29 December. If Stiga Intressenter acquires the necessary shares, the Monark Stiga will be de-listed from the OM Stockholm Stock Exchange. Stiga Intressenter will continue to function as an unlisted company. "The performance of the Monark Stiga share has been significantly weaker than the general index over the past year," says Salvatore Grimaldi, president and CEO of Monark Stiga and owner of the Grimaldi Industri AB. "The primary reason is the deteriorating profitability in the bicycles business area. The structural measures that have been implemented have not resulted in the expected effects, due primarily to severe market pressures with weakening demand and falling prices. Demand has also shifted to less expensive product segments. Further measures are therefore necessary." For more information on Monark Stiga's financial results during the first nine months of this year see elsewhere on these News pages. (AR)