EDITORIAL: Aton, M&R count cost of failed merger

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The aborted takeover bid is certain to have destroyed value for Aton’s owners and incurred huge fees for M&R shareholders

Sometimes it’s difficult not to suspect that companies exist to keep lawyers and corporate advisers in business. That seems to be the case at Aton and Murray & Roberts who have been embroiled in a protracted and acrimonious takeover battle for the past 17 months.

Recall that not only was the Takeover Regulation Panel dragged into this deal but the special committee of that panel was also brought in to referee innovative aspects of it; and not only were the competition authorities called upon to defend one or other side, the Competition Appeal Court was also dragged in.

To be expected, M&R will not reveal how much it spent on fees to fight off the unwelcome bidders, but given the extent of that fight, and its occasional ingenuity, it must have run to tens of millions of rand. While shareholders might prefer to see the group’s limited cash resources spent on operational assets, the independent board is entitled to spend whatever money it deems necessary to fulfil its responsibilities in terms of the Companies Act and the Takeover Regulations.

 

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