DP Eurasia shareholders reject Jubilant FoodWorks' new offer
- Jubilant FoodWorks made its first acquisition approach for DP Eurasia last month
- DP Eurasia was Russia's third-largest pizza delivery company until its departure this year
Shareholders of DP Eurasia have firmly rejected a revised takeover bid from Jubilant FoodWorks.
DP Eurasia, the exclusive master franchisee for Domino's Pizza in Azerbaijan, Georgia and Turkey, received an offer of 95 cents per share, worth £140 million, from the Indian foodservice company on Tuesday.
Jubilant's Dutch division made an initial approach for DP Eurasia last month after increasing its stake in the group from 49 percent to 53.5 percent.
Scope: DP Eurasia is the master franchisee of Domino's Pizza in Azerbaijan, Georgia and Turkey
The 85 cents per share deal was rejected as being too low, with DP Eurasia bosses also saying they were 'extremely disappointed' with the 'unsolicited and opportunistic manner in which' Jubilant made the offer.
Jubilant then raised its offer by a further 10 pence per share on Tuesday, but DP Eurasia's board said the proposal “continues to fundamentally undervalue” the company and its prospects.
After consulting with major institutional investors, DP Eurasia said there was “unanimous agreement” among them not to support the new deal.
Jubilant, which owns Domino's master franchises in India, Bangladesh, Nepal and Sri Lanka, needs support from three-quarters of shareholders to get the takeover accepted.
The company added: 'As long as this status quo is maintained, without the support of these shareholders, Jubilant Foodworks cannot take the company private or implement any of the mechanisms to squeeze out the minority shareholders as set out in the offer document . .
“The board intends to use this strength of shareholder support to encourage Jubilant Foodworks to offer a fair price that the board can recommend and that shareholders are willing to accept.”
DP Eurasia was the third-largest pizza delivery company in Russia until it left the country earlier this year due to the escalation of the war in Ukraine.
It was heavily criticized for keeping its restaurants open, which it said was to protect staff, long after many other businesses had shut down or announced plans to close their Russian operations.
After plans to sell its DPRussia subsidiary fell through, it instead decided to put the division in Russia into bankruptcy over the summer.
In its latest trading update, DP Eurasia said sales rose by more than a third in the 10 months ending in October, thanks to strong demand in Turkey.
For the full year, the company expects comparable sales growth in the high teens, at least 35 to 40 new Domino's Pizza store openings and 50 to 60 additional locations belonging to the COFFY coffee shop brand.
DP Eurasia shares were 0.3 percent higher at 93.3 pence by early Thursday afternoon, about 36 percent above their value before Jubilant's first takeover bid.