Currys Share Price Spiked 9.19% After Rejecting The Second Offer

The Currys PLC (LON: CURY) share price spiked up 9.19% after the electronics retailer declined the second offer from Elliott Advisors (UK) Limited, valuing each outstanding share at 67p. The company’s board said that the revised offer significantly undervalued the Company and its future prospects.

The engagement between Currys and Elliott began with an unsolicited offer from Elliott, proposing to acquire the entire issued and to be issued share capital of Currys at 62 pence per share. This initial proposition, referred to as the “First Elliott Proposal,” was unanimously rejected by the Board of Currys.

The basis for this dismissal was rooted in the Board's assessment that the offer substantially undervalued the company and its future growth and development prospects. The Board's decision underscored a confident vision for Currys' value and potential, setting a precedent for future negotiations.

Not deterred by the initial rejection, Elliott advanced its pursuit with a revised proposition. On a date following the initial announcement, Elliott presented the “Second Elliott Proposal,” offering an increased bid of 67 pence per share for Currys. This move indicated Elliott's continued interest in acquiring Currys and demonstrated a willingness to reevaluate its initial valuation.

After thorough deliberation, the Board of Currys evaluated the Second Elliott Proposal in consultation with its financial advisers. The conclusion reached was consistent with their initial stance; despite being higher, the offer was still perceived as significantly undervaluing the company and its future potential.

On 26 February 2024, the Board unanimously rejected Elliott's second offer. This decision was emblematic of the Board's steadfast belief in Currys's intrinsic and future value, reinforcing its commitment to safeguarding shareholder interests.

The unfolding scenario between Currys and Elliott highlights the speculative nature of corporate acquisitions and the uncertainty accompanying such propositions. While the Board of Currys has clearly articulated its position, the possibility of further offers or negotiations cannot be dismissed.

According to Rule 2.6(a) of the Code, Elliott must clarify its intentions by no later than 5.00 p.m. on 16 March 2024. It must either announce a firm intention to make an offer in accordance with Rule 2.7 of the Code or state its decision not to pursue an offer for Currys. 

Currys share price. 

Currys share price spiked 9.19% to trade at 72.83p from Monday’s closing price of 66.70p.