IWP shares’ sale fuels speculation of buyout bid

IWP SHARES were bought heavily in the Dublin market yesterday, fuelling speculation of an imminent offer for the personal care products group.

Up to 750,000 shares were bought at 34c a share, which left the price unchanged on the day.

The huge volume, nearly five times the average trade in the shares on a daly basis, was a clear signal the markets were expecting a bid early next week.

Market sources say the management buyout offer dealt with in a recent IWP statement is about to materialise.

Heading the MBO is finance director Bernard Byrne and some outside backers. The shares have been bought in anticipation of a 50c per share bid for the group, headed by Joe Moran, who is expected to sell if the offer comes in at that level.

Over the past two years, IWP’s fortunes have reversed dramatically and the group was forced to scale back its operations.

“If someone comes in with a firm offer at a premium to the current share price, we will have to consider it,” Mr Moran said at the time that news of the MBO first emerged.

The takeover rumours resulted in a near 30% rise in the share price to 31c and it has held more or less steadily at that level since then. Over the previous two years, the price of the shares fell 80% as the company’s fortunes declined in the midst of a highly complex home care and personal care market.

As one of the smaller mid cap stocks on the stock exchange, IWP has lost some of its status as an investment vehicle for pension funds that generally have lowered their exposure to Irish quoted companies.

If the MBO materialises, then Mr Moran, who still holds 17$ of the company’s equity, will retire from the company, which will then be taken private.

If the bid fails, then Jim Murphy, the former boss of Golden Vale, will take over as chief executive.

However if the MBO offer comes to light and is then accepted, that plan will be scrapped and it is understood the MBO team will proceed to appoint its own senior executive them, that does will not include Mr Murphy.

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