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The UK online and land gambling group Rank plc has urged its shareholders to reject a 150 pence a share takeover bid from the Malaysian-based Guoco Group Ltd, its largest investor, saying it undervalues the company.
The Reuters news agency reports that last Friday Guoco, a property and investment holding firm controlled by Malaysian billionaire Quek Leng Chan, acquired an 11.6% stake in Rank, increasing its shareholding to 40.8% and triggering a mandatory takeover offer.
The 150 pence a share offer represents a 0.8% premium to Rank's closing price on Friday of 148.8 pence and values the firm at about £586 million.
Guoco has been quietly building its stake in the UK company, which was recently boosted when it won a legal action for the return of VAT with the UK Customs and Excise authorities.
"The board has considered the offer and believes that it significantly undervalues Rank and its prospects and, as a result, recommends that shareholders do not accept it," Rank said in a statement, noting that Guoco has reiterated its support for Rank and its management team.
Source: InfoPowa News