A second big shareholder of Daily Mail and General Trust has opposed Lord Rothermere’s bid to take the media group private, attacking his offer as “neither fair nor supportable”.
J O Hambro Capital Management said on Friday it was “underwhelmed and unconvinced” by the takeover proposal from the Rothermere family, which it said failed to recognise the long-term value of DMGT assets such as the Daily Mail newspaper and MailOnline.
Through a family investment vehicle Jonathan Harmsworth, Viscount Rothermere, made a formal offer this month for DMGT of around £2.9bn. This included a special dividend and returning cash from the sale of the insurance risk business RMS and the listing of Cazoo.
The offer has been recommended by the group’s independent directors but is facing growing opposition among investors who hold the 72 per cent of the group’s non-voting stock that is not owned by the Rothermere family.
Majedie Asset Management has also publicly urged shareholders to reject the offer, adding pressure on the Rothermere family to improve the offer to meet the 90 per cent support threshold that would force the deal through. J O Hambro and Majedie own 3.3 per and 4.6 per cent of DMGT shares respectively.
The family also has the option to adjust the threshold to push through the deal. The Rothermeres only need to secure 50 per cent to delist DMGT and in this scenario investors unwilling to sell would be offered shares in the resulting private company.
J O Hambro urged other investors to stop the Rothermere family being able to “exploit the current asymmetry of information” regarding the prospects for DMGT’s businesses. “The residual assets are worth far more than the current offer and shareholders should receive a fair and realistic price,” it added in a statement.
The takeover bid would end DMGT’s 90-year history as a listed group and represents one of Harmsworth’s most important decisions since taking the helm of the media dynasty in 1998.
Harmsworth this week also unexpectedly overhauled top ranks of his news division, ousting Geordie Greig as editor of the Daily Mail after just three years in the job.