BWX Limited

BWX Details

Received a Sweet Offer for 100% of BWX Shares: Branded skin care and hair product group, BWX Limited (ASX: BWX) sits at a sweet spot as itsstock price surged up by 35.37 per cent on May 22, 2018 following the release of announcement on receiving an unsolicited preliminary, non-binding, indicative and conditional proposal from John Humble (CEO and Managing Director) and Aaron Finlay (Finance Director) in partnership with Bain Capital Private Equity, L.P. and its affiliates (Bain Capital), to acquire 100% of the shares in BWX. According to the indicative proposal, the offer is either $6.60 cash per share or as a scrip alternative in a newly incorporated acquisition entity of 75% shares and rest in cash. This $6.60 cash per share represents about 50% premium over BWX’s Friday closing price of $4.41 cash per share. The Board of BWX has established an Independent Board Committee (IBC) comprising Denis Shelley (Chairman), Ian Campbell and David Fenlon to consider and respond to the Indicative Proposal. The indicative proposal is subject to several terms and conditions, including the satisfactory completion of due diligence by Bain Capital; finalisation of debt commitments for the transaction and final approval from Bain Capital investment committee; unanimous recommendation of the Independent Board Committee (IBC) in favour of the Indicative Proposal; no material transactions by BWX; and entry into a definitive scheme implementation deed between BWX and the acquisition entity. In the meantime, BWX’s management advised shareholders to take no action at this time in relation to the Proposal.


Summary of Growth Opportunity (Source: Company Reports)

On the other hand, Aron Finlay, Sol Capital Pty Ltd, Fairlight Capital Pty Ltd, and Bain Capital Private Equity L.P., became the substantial holder of the Group since May 19, 2018 by holding 10.38 per cent of the voting power based on 122,731,270 shares on issue. Given the rally and growth potential while the stock had fallen down about 39.92 per cent in the past three months as at May 21, 2018, we put a “Hold” recommendation at the current market price of $ 5.970. The stock, however did not touch about the offer price and it will be a key thing to watch for any superior proposals in the days to come.

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