Vital Ltd shareholders weighing up a takeover offer by Christchurch communications company Tait International have until August 8 to opt into a share buy-out at the “low end” of an independent valuation.
Tait intends to buy all Vital’s shares for a premium of 45 cents in cash per share and all the unlisted employee share options for 13c per option.
In a NZX update on Friday morning, just over 28% of shareholders with the listed company had accepted the share offer.
This follows Vital’s board recommending shareholders and option holders accept the takeover offer made on June 19, despite the low price.
The recommendation was based on a commissioned independent adviser’s report taking in the merits and directors’ views on future market and strategy execution risks.
Vital operates from Wellington headquarters a network operations centre that monitors telecommunications networks across New Zealand.
The Tait takeover is conditional on enough acceptances being obtained for it to hold or control at least 90% of Vital’s voting rights.
Tait has advised it will not increase its offer under any circumstances.
The company said the offer was a strategic move to expand its market positioning, product offerings and reach in New Zealand, which would benefit Vital customers, employees and other stakeholders.
Tait Communications chief executive and managing director Yoram Benit said in a statement Tait was happy with the recommendation by the Vital board.
Vital’s board noted in a target company statement the offer was at the low end of the independent adviser’s range of 44c to 69c per Vital share, which undervalued its business and network assets.
However, the directors believed counter-balancing factors, such as share price and liquidity issues, future market and strategy execution risks and the ability to offset the possible loss of a St John contract outweighed the low offer price.
Competing offers were considered unlikely.
Tait’s offer is a 63.6% premium on the trading price of 27.5c per share set on the NZX main board on May 26, when a trading halt was put in for the takeover offer.
The 30-day volume weighted average price was 24.9c per share up to the last full trading day on May 23.
The highest price they reached in the past two years was 29.5c, apart from a trading surge to 37.5c in 2024 when Empire Technology Limited gave notice of a partial takeover offer to buy 50.1%, before it was withdrawn.
