IPH sweetens Xenith takeover offer

IPH has lifted its takeover offer for Xenith after ‘constructive’ talks between the intellectual property firms.

IPH has lifted its offer for takeover target Xenith following “constructive” negotiations between the intellectual property firms.

IPH has lifted its offer for takeover target Xenith following “constructive” negotiations between the intellectual property firms.

Xenith last month rebuffed IPH’s initial takeover offer, saying its $2.02 offer was not superior to a proposed merger with Qantm.

IPH’s sweetener comes after a recent rally in its share price.

The new IPH offer for its smaller rival is for a combination of cash and IPH shares valued at $2.15 per Xenith share. However, it also includes a “mix and match” facility allowing Xenith shareholders to elect to receive up to 100 per cent of that price in cash or scrip alone, subject to scale-back.

“IPH believes the revised IPH proposal provides compelling benefits for Xenith’s shareholders, its leading IP attorneys and other stakeholders,” IPH told the ASX last night.

It said the sweetened offer includes $1.28 cash and 0.1261 IPH shares for every Xenith share, representing a total value of $2.15 per Xenith share, based on IPH’s closing price on April 5 of $6.90 per share, valuing the remaining equity of Xenith at about $154 million.

IPH said it was seeking to sign a deal with Xenith by April 12.

However, in a separate proposal, Qantm is offering Xenith shareholders 1.22 Qantm shares for every Xenith share in a scrip-only deal. Xenith earlier backed the Qantm merger plan over Xenith’s initial offer.

Shares in IPH closed up 9c, or 1.3 per cent, at $6.99 yesterday, while Xenith shares closed down 0.5c, or 3 per cent, at $1.92 apiece.

The proposed merger of Xenith and Qantm would give the combined firm 32 per cent of the Australian market, against 40 per cent for the IPH proposal.

Qantm had maintained that an IPH and Xenith combination would spark scrutiny from the ACCC.

However, the ACCC late last month cleared the IPH bid after bringing forward its decision from the original date of May 2, to allow Xenith shareholders time to consider the matter.

The original partners of Xenith hold 40 per cent of the stock, and while some are eager to see the Qantm merger proceed, others are thought to be in favour of the IPH transaction.