Aggressive US hedge fund Elliott International has further increased its stake in Prezzo, the Italian restaurant chain which has agreed to a £303.7m takeover by private equity firm TPG Capital.
Elliott now holds a 12.14% stake in the c250-strong restaurant company, with shareholders set to vote on the proposed takeover, which has drawn criticism for undervaluing the business, next month.
TPG has the support of 62% of shareholders and so needs to persuade another 13% of investors to agree to the acquisition.
In November, Elliott disclosed that it had built a near 3.1% interest in Prezzo via contracts for difference. Its original position was taken the same day that Prezzo agreed to be acquired by TPG.
Shares in Prezzo closed unchanged yesterday at 127.75p, giving it a market capitalisation of £300.1m.
Earlier this month, leading analyst Nick Batram at Peel Hunt said that Prezzo shareholders should reject the agreed £303.7m bid from TPG Capital because 126.5p fundamentally undervalues a business with an” impressive track record and exciting prospects”.
He said: “We appreciate the risks of the family exiting and TPG have been very cute and picked up a good business at an attractive price. However, independent shareholders should be disappointed at the exit price and, for those that can hold unquoted equity, they should reject the bid.”
