The accounting market has precious few listed firms. The industry’s biggest
concerns are privately owned by their partners, and when firms merge, they do so
by agreement. What this means, apart from many other things, is that we rarely
get a good bid battle.
Until now. Vantis last week was forced to reveal to the stock market that it
had received an informal offer.
So will we now get months of uncertainty as to whether the firm is ‘in play’ and
about to be bought? Is the mid-tier consolidation often talked about actually
going to happen?
Vantis’ shares soared last week. In total, around 130,000 shares were
exchanged on May 6 in moves that saw the price go up by 30%.
At that point, according to insiders at the firm, the takeover panel insisted
the firm inform the market as to what was going on. The result was a stock
exchange announcement confirming that, in its words, an ‘unsolicited, very
preliminary’ offer had been made.
But Vantis said it would not be pursuing the offer. The next day it confirmed
that, saying that the offer had been rejected.
What’s going to happen?
It’s difficult to know what to make of the offer. The firm provided no
details as to who had made the suggestion, and insiders played down its
It was merely a conversation, they said, the kind that goes on all the time.
Investors are likely to have been satisfied by that explanation, seeing it as
the end of the matter. But for the accountancy market, there may be a greater
Observers will be curious as to how many ‘conversations’ are going on at
present. Robson Rhodes has merged with Grant Thornton, in a move that was
pitched as an attempt to take on the Big Four.
Rumours fly around about other deals, but there is also some scepticism in
the market about any ‘breakthrough’ deal.
Clearly some people think there is something in it. Vantis’ shares remained
ahead of the price before the bid frenzy at the time of going to press.
Just as analysts read into share prices the likely outcome of a bid battle,
is the strength of the Vantis share price a sign that everyone is expecting
mid-tier merger activity?
The abortive bid for Vantis could be a sign of things to come.
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