Think Childcare (ASX:TNK) share price rockets 33% on latest takeover bid

The Think Childcare Ltd (ASX: TNK) share price is surging 33% today after the company received a revised offer for a takeover.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Think Childcare Ltd (ASX: TNK) share price is surging 33% today. The astronomical sum comes after the company received a revised offer from Busy Bees Early Learning Pty Ltd for a takeover.

At the time of writing, the Think share price is trading at $3.06 – up 32.47%. By comparison, the S&P/ASX All Ordinaries Index (ASX: XAO) is 1.17% higher.

Let's take a closer look at today's announcement.

Think share price shoots higher on bidding war

The Think share price is on a tear. In a statement to the ASX, Think announced it had received a revised offer of $3.20 per share from Busy Bees to buy 100% of the company. This latest offer represents a 52% premium on its previous offer of $2.10 per share.

The price paid will drop by the amount of any dividend paid by the group after the date of the proposal. Think advised it would pay a dividend of at least 34 cents a share, fully franked, soon.

The offer of $3.20 is 192% higher than the volume-weighted average price (VWAP) for the last month.

Busy Bees is in a bidding war for Think with Alceon Private Equity. The two companies have been making offers for the childcare provider since November 2020. The Think share price has been rising with each offer.

For context, the first offer from Alceon was for $1.35 a share. Busy Bees followed this up with an offer of $1.75 a share.

After today's offer, Think is offering Busy Bees an exclusivity period to negotiate a deal until 14 May 2021.

If a deal were to go through it would be subject to several conditions, including:

  • Due diligence requirements.
  • Obtaining regulatory approval.
  • The consent of Busy Bees' owner Mathew Edwards.
  • The signing of documents, and
  • Approval by the Think Board.

 

Alceon backing down?

Alceon already owns approximately 19% of Think through its subsidiary, NKT Investments Pty Ltd. As such, it has a powerful say on whether or not to accept any deal from Busy Bees.

Think, however, says that after communicating with Alceon, the private equity firm is prepared to support the Busy Bees offer. If that is the case, the Think share price should begin to stabilise.

Think share price snapshot

Over the last 12-months, the Think share price has increased 246.07%. Of course, the vast majority of the company's growing valuation has come as a result of the takeover talks.

Given its current share price, Think has a market capitalisation of $187.6 million.

Motley Fool contributor Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Broker Notes

Top brokers name 3 ASX shares to buy today

Here's what brokers are recommending as buys this week.

Read more »

Disappointed man with his head on his hand looking at a falling share price his a laptop.
Share Fallers

Why Iluka, Sigma, Wildcat, and Woodside shares are falling today

These shares are having a tough time on hump day. Why are investors hitting the sell button?

Read more »

A woman with strawberry blonde hair has a huge smile on her face and fist pumps the air having seen good news on her phone.
Share Gainers

Why Bubs, Chrysos, JB Hi-Fi, and Paladin Energy shares are storming higher today

These shares are having a good time on hump day. But why?

Read more »

Man and woman sitting at casino table playing poker
Opinions

Australia's biggest winners in 2025? My money is on these 2 ASX shares

Here’s why I think these stocks could be underrated winners.

Read more »

Cheerful boyfriend showing mobile phone to girlfriend in dining room. They are spending leisure time together at home and planning their financial future.
Opinions

Here's how I'd invest my next $5,000 on the ASX in 2025

These two investments could make a lot of sense this year.

Read more »

A view of New York at sunrise looking from inside an aeroplane window.
Growth Shares

2 ASX growth shares I'd buy that could benefit from Trump

These stocks look to me like compelling options in the years ahead.

Read more »

Smiling man with phone in wheelchair watching stocks and trends on computer
Share Market News

5 things to watch on the ASX 200 on Wednesday

Another good session is expected for Aussie investors today.

Read more »

Happy diverse colleagues or team of people give high five together to celebrate great teamwork and results.
52-Week Highs

8 ASX 200 shares smashing 52-week highs today

These stocks hit new highs amid a turbulent day for the ASX 200.

Read more »