In a statement published earlier today, AFH confirmed that Lighthouse had turned down a £17.4m ($24.5m, €21.9m) bid to buy the company following an announcement by Lighthouse describing the bid as ‘fundamentally undervalued’.
However, AFH said it would not increase its offer and has now dropped its bid, stating that there has been a 35% price movement in the shares of Lighthouse since the initial offer was made earlier this month.
Due diligence
The company stated that a ‘lack of willingness’ by Lighthouse to engage in takeover talks before rejecting the potential bid meant that it could not carry out an ‘appropriate level of due diligence within the time period imposed’.
FCA liabilities
AFH also highlighted that Lighthouse would need to hold back £7.9m – half of its cash reserves -to cover FCA regulatory liabilities. As a result, it predicted ‘limited growth prospects’ for Lighthouse under its current strategy.
Alan Hudson, chief executive of AFH, said: “We are naturally disappointed with the reaction of Lighthouse to our indicative proposal which included a mix and match structure for individual Lighthouse shareholders.“
