IFG shares slide after talks on possible takeover end

IFG, a Dublin-based financial services group, fell the most in more than eight years after it said talks on a takeover bid with Bregal Capital concluded without a bid.

At lunchtime, IFG shares dropped 29% to €1.16, the biggest intra-day declined since February of 2003. However, the shares ended the day slightly up closing down 26% at €1.20 in Dublin.

“In view of the current dislocation in global markets, both IFG and Bregal have agreed to discontinue discussions” about a takeover, IFG said.

“We agreed with Bregal that we would go forward into exclusivity at a price of €1.80,” IFG chief executive Mark Bourke said.

As the global outlook soured, markets dropped, and financing became more difficulty globally, the deal became a “tough deal for them at the price agreed,” Mr Bourke said.

IFG said last month its adjusted operating profit rose 22% to £11.9 million in the half year ended June 30. Mr Bourke said IFG plans to pay a previously proposed dividend.

“They basically said they were not prepared to do it at that price and it was always on that basis,” Mr Bourke told Reuters. “The market does affect the availability of debt.

“It makes it very hard to do a deal with that level of uncertainty around and everybody feeling negative rather than positive.”

The euro and European stocks dropped yesterday amid concerns about the eurozone’s ability to deal with a debt crisis that risks triggering another banking crisis and global downturn.

Mr Bourke said the group, which makes over 80% of its revenues in Britain, was not in discussions with anyone else.

IFG’s largest shareholder, Fiordland, which owns 19% of the group, had approached the group in May about a possible takeover.