Legend Corporation lands juicy takeover offer

Will Legend Corporation Limited (ASX: LGD) fall into private ownership?

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The Legend Corporation Limited (ASX: LGD) share price is likely to surge higher next week after the electrical solutions group revealed it intends to accept a 36.5 cents per share cash offer from Adamantem Capital.

The deal can also be structured so shareholders can receive 3 cents per share in franking credits from the offer by structuring it so that part of the offer is paid as a special dividend.

Legend reports the offer values its equity at $79.6 million or $100.6 million as an enterprise value business when including the debt. According to management the 36.5 cents per share offer price represents a 22.6% premium to the one-month volume weighted average price.

Legend Chairman, Bruce Higgins said: "The proposed transaction represents a compelling value and liquidity opportunity for all Legend shareholders relative to recent trading prices and volumes."

For the six months ending December 31 2019 Legend made a net profit of $4.1 million on 1.9 cents in earnings per share.

Motley Fool contributor Tom Richardson has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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