AMP limited (AMP) has dropped plans to takeover property investor MacarthurCook Limited (MCK) after the target approved a strategic alliance with IOOF Holdings Limited (IFL). The offer tabled in June valued MacarthurCook at $31 million.
AMP's takeover proposal was for $1.35 cash per share for all the issued ordinary shares in MacarthurCook.
The valuation represented a 69% premium on the closing price of 80 cps on 6 June 2008, which was the last trading day before the proposal was submitted.
AMP said the takeover was subject to a number of pre conditions including satisfactory due diligence and a board recommendation.
At MacarthurCook's general meeting yesterday the company approved a proposed strategic alliance between the company and IOOF.
"Despite significant votes against resolutions 2 and 3 at the MacarthurCook extraordinary general meeting on 27 August, the IOOF placement and alliance has been approved by shareholders," AMP said.
"In view of this, AMP Capital has considered its position and decided that in the absence of the MacarthurCook board providing due diligence, AMP Capital will not further its proposal," AMP said.
The terms of the placement of 13% MacarthurCook's issued shares with IOOF at $1.15 each restrict the stock being sold within two years of the transaction, except where a takeover is recommended by its board or a third party buys more than 50% of the company.
At 1145 AEST shares in AMP were up 9c to $6.91 , and IFL had gained 11c to $5.52 and MCK was flat at 80c.