Shock, horror, the board of Spotless Group (SPO) has recommended investors knock back the $1.2 billion bid from Downer EDI (DOW) labelling it as “opportunistic, hostile, highly conditional’ and unlikely to proceed.
Macquarie suspects the first half will reflect a transitional year for FY17. There was no specific guidance for FY17 provided at the AGM and the broker’s revised forecasts for earnings per share are down -15% on the prior year.
Citi analysts have updated their analysis and there’s now an expectation the company’s interim report is poised for disappointment. Estimates have been reduced by no less than -30% for this year and next.
Spotless has decided to retain its laundries business, believing this option will provide the best value for shareholders. Deutsche Bank does not believe Spotless was a forced seller and was only exploring a potential sale given it had received unsolicited proposals.