KEY POINTS:
A takeover offer for childcare centre operator Kidicorp has been recommended by its independent directors, in the absence of a better offer.
Positive Educare has offered shareholders 24c a share, conditional on it getting 90 per cent control.
The offer has already been accepted by 19.9 per cent stakeholder Fisher Funds which, alongside majority shareholder Mitchell Investment Trust, would give Positive Educare 74 per cent.
The independent directors also flagged their intention to accept.
Their reasons included the fact that any competing bid would struggle to get acceptance from Mitchell, which is associated with Positive Educare and holds 54.5 per cent of Kidicorp.
They also felt the early education sector held "significant risks" at the moment, particularly the level of government funding and rising employment costs.
There was also "limited liquidity" in Kidicorp shares.
Shareholders had not been able to realise a similar price for their shares on the market for some time, and the offer was nearly a 30 per cent premium to Kidicorp's closing share price of 18.5c on May 31.
They noted that since the offer, shares had ranged between 21c and 24c a share.
While the offer was at the bottom end of the independent valuation range, Positive Educare had indicated it would not raise its price.
Kidicorp operates 78 early childhood centres, with a 6 per cent market share. Kidicorp shares closed unchanged at 23c.
- NZPA
