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Madison MBO Fails

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LONDON, UK (April 11) – Following the announcement in early March of an intention by the Madison management team to effect a buy out of the Madison and Leeda (fishing tackle) operations, in a move which had apparently been supported by the board of Directors of H Young Holdings PLC (the holding company), it has […]

LONDON, UK (April 11) – Following the announcement in early March of an intention by the Madison management team to effect a buy out of the Madison and Leeda (fishing tackle) operations, in a move which had apparently been supported by the board of Directors of H Young Holdings PLC (the holding company), it has transpired that the shareholders had different intentions. Soon after the initial announcement, rumor started about potential problems with the initiative.
The planned MBO was headed by Terry Bowles (Chief Executive). The deal was reported to be circa GBP26mn (US$38mn;EUR 41mn) and was to be funded by the Lloyds TSB Bank Group. Additionally, a previous Managing Director of Madison Cycles, Mark Walmsley, had planned to rejoin Bowles following the successful completion of the MBO. Now it seems, the shareholders of H Young plc have voted against the board and prevented Madison and Leeda being sold. At a recent extraordinary meeting to approve or reject the sale of the two companies the shareholders voted 52-48 against the board of H Young plc. The main reason for the vote going this way is the fact that an unsolicited bid for H Young has been received from Lakefield Holdings Ltd but this bid is conditional upon the sale of Madison and Leeda not completing. The implication therefore is that a majority of shareholders will accept the Lakefield offer for H Young unless another higher bid comes forward quickly. Bill Caldwell, Chairman of H Young, said: “We are disappointed that Shareholders have not supported the disposals of Madison and Leeda due to the opportunistic offer by Lakefield. Shareholders should continue to reject Lakefield’s inadequate offer which undervalues the Group.” (MR)

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