Liberum downgrades Marston's following takeover approach
Liberum has downgraded Marston’s to ‘hold’ after takeover speculation pushed the share price higher.
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The brewer and pub company is currently considering an unsolicited approach from US private equity firm Platinum Equity Advisors. No further details have been announced by Marston’s, although in accordance with the Takeover Code, Platinum must make a firm offer or walk away by 26 February.
Anna Barnfather, analyst at Liberum, said: "Marston’s shares have risen up to its current pro forma net asset value following confirmation of a bid approach. No firm offer has been made, and hence no specific details have been provided while the board evaluates the proposal.
"Based on a pre-Covid trailing earnings before interest, tax, depreciation and amortisation of around £180m, current NAV of 87p and recent transaction comparatives, we believe an offer could come in at above 100p.
"However, this is dependent on many factors. We move our recommendation to ‘hold’, giving the upside risk balance with uncertainty over whether a final offer can be agreed."
Liberum, which previously had a ‘buy’ rating on the stock, has a target price of 90.0p. As at 0930 GMT, shares in Marston’s were flat at 82.25p.