Talks around an indicative proposal to take Rotala into the private ownership of three of its Directors continue, with the deadline for them to make a firm offer having been extended for a second time.
Rotala has been listed on the Alternative Investments Market since the operator’s founding in 2005. At the time of writing, its shares were trading at 58p, having risen significantly since news of the indicative proposal was first disclosed on 19 September.
Chief Executive Simon Dunn, his father and Managing Director – North West Bob Dunn, and Non-Executive Chairman John Gunn are behind the approach. If the move into private ownership progresses, it will see them purchase the entire Rotala share capital that they, their spouses and their personal pension plans do not already own.
Under the indicative offer, which would be made by a newly-incorporated entity established by the three offerors, those shares would be valued at 63.5p. A committee of three other independent Directors was immediately formed to consider the possible offer and they quickly said that they “would be minded to recommend” its acceptance by shareholders.
The original announcement noted that the three offerors were required to announce their firm intention to either make an offer, or not make an offer, by 17 October. However, scope was included to extend that date.
On 17 October, it was announced that the deadline was being pushed to 14 November. On the latter date, a further extension to 12 December was made.
Writing in Rotala’s annual report for the year ended 30 November 2022 – published in May – Mr Gunn noted that conditions of change in the bus industry “should bring a healthy flow of opportunities to the company… for both organic growth and acquisitions.”
Evolution of the group’s Diamond Bus North West business in Greater Manchester during the first round of franchising rollout there saw it receive an aggregate cash consideration of around £30.5 million for assets at its former Bolton operation disposed of against their estimated net book value of £23 million, the report notes.
Rotala purchased the Bolton operation from First Bus in 2019 for £5.3 million, although it had invested heavily – including in wholesale fleet renewal – since then.
