its buyout offer that valued the enterprise at A$2.2 billion after the target unanimously rebuffed the unsolicited non-binding proposal. But the roughly 20% stake it picked up around the same time locks the pair into an awkward dance.
It's a messy situation. The company’s stock plunged as much as 15% before paring back some losses, moving below the A$12.65 per share TPG paid for its stake and the same price it was offering for the whole. InvoCare was open to better terms, and offered the suitor access to limited, non-public financial information. TPG declined and now wants a seat on the board instead.
Following the collapse of Silicon Valley Bank in the United States, rising global worries about financial stability will make it harder to do deals. TPG’s offer, at a 41% premium, wasto start with: Breakingviews calculations showed that to generate a 20% internal rate of return after five years would have required TPG to more than double this year’s expected EBITDA to A$320 million. A rethink makes sense.