Abano director resigns amid takeover talks
Abano Healthcare [NZX: ABA] director Peter Hutson has resigned from the board amid a potential takeover involving his interests.
Mr Hutson, along with Archer Capital and James Reeves, hold about 19.99% of the specialist dental and healthcare company.
The group has entered into a five-month standstill agreement in respect of their shareholding while they consider making a takeover offer.
Earlier this week Abano chairman Trevor Janes said the Abano board is seeking advice on Mr Hutson’s ability to keep his directorship given the circumstances.
Abano’s board has rejected an unsolicited proposal from the Archer/Hutson/Reeves group to acquire 100% of Abano at an indicative price of $6.97 to $7.14 per share, lowered from an original $7.50 to reflect dividend payments and a recent capital raising.
This afternoon Mr Hutson issued a media statement announcing his resignation, saying he made the decision in order to allow for a focused business discussion around the merits of Archer’s proposal relative to Abano’s recent performance track record and outlook.
“I fundamentally do not believe this company can prosper in the public domain and with its current business plan and capability.
“I believe resigning from the Board will allow discussion to clearly focus on the fundamentals of the company’s performance, and the urgent need for change.
The last four years of under-performance highlights the fact that Abano’s transformation strategy is not working in a public setting.
“We have put a cash proposal on the table with an embedded takeover premium for control and clearly indicated to The Board that subject to a short period of due diligence, a higher price is possible.”
Mr Hutson has an interest in about 14% of Abano and has been a co-investor with the company in its international ventures.
He was a founder of Bay Audiology, which Abano took control of in 2005 and exited his stake with Abano when Bay Audiology was sold for a profit in 2009 to buyout firm Crescent Partners.
Abano shares are down 5c at $6.70 today, having traded at $5.86 before the takeover proposal was made public in early August.