Volex, the listed manufacturing specialist, has declared its second bid for TT Electronics to be "highly attractive", with the company's chief, Lord Rothschild, calling on shareholders to engage.
The initial offer included 62.9 pence in cash and 0.203 new Volex shares for each TT Electronics share, while the follow-up proposal offered 62.9 pence in cash and 0.223 new Volex shares, implying a value of 135.5 pence per share, as reported by .
Despite this, the board of TT Electronics has not engaged with Volex and has turned down both proposals.
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Now, with Thursday's prices taken into account, Volex's revised proposal would place the value at 139.6 pence per TT Electronics share, putting the fully diluted share capital valuation at £248.6 million.
Volex's board has communicated to its shareholders that it strongly believes the second proposal presents an extremely appealing opportunity for TT Electronics shareholders.
This announcement comes as TT Electronics has announced further job cuts as part of its strategy to counteract "substantial market challenges".
Lord Rothschild, executive chairman of Volex, commented: "We believe that bringing Volex and TT Electronics together in a highly synergistic transaction would create a scaled and diversified leader in the specialist electronics market."
He added, "Despite the resilience of TT Electronics' underlying business, it has faced persistent challenges in recent years, which Volex believes have been exacerbated by execution missteps by the board."
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The executive chairman of Volex, Nat Rothschild, has pointed out that since 1 January 2018, the share price of TT Electronics has fallen by 65 per cent, while Volex's has surged over 300 per cent.
"I therefore strongly encourage TT Electronics shareholders to urge the TT Electronics board to engage with Volex in delivering an expeditious and highly attractive outcome for all stakeholders," he added.
This statement comes as Volex announced its half-year results, which showed a revenue increase of over 30 per cent to $518.2m (£408m). This includes strong organic growth of nearly 10 per cent, along with a rise in sales of electric vehicles and consumer electricals.
Volex reported that its underlying operating margin was "comfortably maintained" within the target range, and its interim dividend increased by over 7 per cent to 1.5 pence per share.
Rothschild stated: "the strong performance during the period demonstrates once again that our strategy is working".
"Our delivery to date, at the halfway point in our five-year plan, gives us increased conviction in our ability to achieve our goal of securing revenues of $1.2bn by the end of FY2027 at an underlying operating margin of 9-10 per cent," he added.