Findel urges shareholders to reject Sports Direct takeover bid

Home shopping retailer Findel has urged its shareholders to reject an "opportunist" takeover bid from Mike Ashley’s Sports Direct.

In a statement released Wednesday, Findel said it thinks Sports Direct’s current offer of 161p per share “significantly undervalues Findel and its future prospects” when compared to analyst target prices which range from 300p to 350p. Sports Direct made the mandatory offer earlier in March after the sports retailer raised its stake in Findel to 36.8 percent.

Findel said that control by Sports Direct would have a number of potentially adverse consequences for Findel shareholders including an 8.8 percent dilution in the value of their shareholdings.

Ian Burke, Chairman of Findel, commented in the statement: "The Findel board believes that Sports Direct's offer is highly opportunistic and significantly undervalues the group and its prospects. Sports Direct's offer provides no compelling reason as to why 161p per share represents a fair price, especially given the operational and financial progress made in transforming the Group into a market-leading online value retailer.

“As stated in its offer document, Sports Direct endorses the strategic plans that the Findel board is implementing, and is supportive of the Findel leadership team delivering these. It is against this backdrop that the board is unanimous in its recommendation that shareholders reject the offer and take no action."