The takeover race for KCOM will go down to the final day after bidder Macquarie returned with a £578m offer for the Hull firm.
Pension fund provider and rival buyer USS (Universities Superannuation Scheme) had up until Thursday evening been ahead in the race, after it offered £573m.
But Macquarie’s latest offer – raising the bid by £5m – means the auction will go down to the wire on Friday.
KCOM originally floated on the Stock Exchange at 225p per share.
The latest bid from Macquarie represents 110.8p.
A statement on the Stock Exchange said: “Following the conclusion of Auction Day four (as specified in the Auction Rules), MEIF 6 Fibre is pleased to announce the terms of a revised increased cash offer for the entire issued and to be issued share capital of KCOM.
The Acquisition, at the increased price of 110.8 pence per KCOM Share in cash, represents an increase of 0.8p to the USS offer of 110p per share.”
Macquarie said its new offer also represented “an aggregate value of £578 million for KCOM's issued and to be issued share capital.”
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“Under the revised increased offer, fractions of pence will be paid to KCOM Scheme Shareholders and cash entitlements will be rounded up to the nearest penny,” it said.
The two prospective buyers have this week been locked in an auction for KCOM.
USS was the first company to bid for KCOM back in April. It’s first offer was for £504m.
Since then, rival buyer Macquarie has entered the fray. Macquarie offered £563m for KCOM in June, prompting the British Takeover Panel to demand an auction to settle the outcome.
During this week, that price has risen by another £15m, to its current high of £578m.
On Friday, Macquarie and USS will submit one more bid each for KCOM, as a final offer.
The highest bidder will then be revealed.
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Shareholders at KCOM are then expected to vote on the winning bid and supporting deal, but it is widely expected the final share price will be considerably lower than the 225p floating price.
The new bid was technically tabled by a subsidiary of Macquarie Infrastructure and Real Assets (MIRA). MIRA is one of the world’s biggest asset managers, and handles over €110bn of assets across the globe.
More importantly though, it is a major investor and owner of telecommunications infrastructure.