As the shares prices of many of Australia’s small and medium listed companies continue to take a battering, there are signs cashed-up entrepreneurs and private equity firms are preparing to go bargain hunting.
As the shares prices of many of Australia’s small and medium listed companies continue to take a battering, there are signs cashed-up entrepreneurs and private equity firms are preparing to go bargain hunting.
Melbourne-based property company Becton is one company that has received offers from as-yet unnamed companies interested in acquiring the weakened developer.
Becton’s shares have slumped from around $5 in December 2007 to just 25c as a result of the credit crunch and financial crisis.
There were rumours that the company’s founder and major shareholder Max Beck (who was valued at $330 million in this year’s BRW Rich 200) was preparing to privatise the company, but Beck has since declared he won’t be buying back his baby.
But chief executive Matthew Chun says the company is dealing with a number of local and offshore buyers who are interested in buying Becton’s development and construction arm, its retirement decision and its funds management business.
Meanwhile, Sydney-based digital marketing and media group Photon is also at the centre of takeover speculation. The group, which contains almost 50 separate companies including PR agencies, marketing services businesses and web development companies, has been lashed by investors in the past 12 months as concerns about advertising spending have mounted. Photon’s shares peaked at $6.73 in November 2007, but have since sunk to $1.50.
While Photon major shareholders, Reg Grundy’s RG Capital and the Bailey family, have ruled out selling their holdings (which equate to around 33%) it is believed Photon is looking for a buyer for the other two thirds of the business.
The Australian has reported that several private equity firms are interested in swooping on the company.
Reports also surfaced this earlier this week that the company’s chairman, media entrepreneur Tim Hughes, was considering privitising the company.
One of the last entrepreneurs to take his company private was Brett Blundy, whose fortune was valued at $316 million earlier this year. He took his retail company Brazin private in early 2007 after being disappointed at the way the company’s shares were rated by the market.
Blundy’s deal might provide the blueprint for a growing number of unhappy entrepreneurs in the coming months.
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