(Bloomberg) -- PAI Partners has boosted its offer for diaper maker Ontex Group NV, clearing the way for the European private equity firm to start going over the company’s books. The Belgian firm’s shares surged.
Ontex’s board agreed to allow PAI to start due diligence, while “not being in a position to recommend the revised proposal” of 27.50 euros per share, the buyout firm said in a statement on Monday.
The personal-care company on Friday confirmed receiving the proposal about a possible cash bid after Bloomberg News reported earlier that PAI had approached Ontex. The company’s largest shareholder, billionaire Albert Frere’s Groupe Bruxelles Lambert SA, may be in favor of a deal, people with knowledge of the situation had said.
Ontex jumped 41 percent to 27.34 euros in Brussels trading at 1:14 p.m., more than any full-day gain since the company’s June 2014 initial public offering.
The shares had fallen in the past year and were trading at about 19.41 euros each last week, giving Ontex a market value of about 1.6 billion euros ($1.8 billion), before trading was suspended. On July 3, the stock hit 18.67 euros, the lowest level since September 2014.
The previous bid was unanimously rebuffed by the board as it “significantly undervalued” Ontex, the company had said in a statement. The company didn’t give an amount for the earlier offer. Chief Executive Officer Charles Bouaziz, who is on PAI’s board, wasn’t involved in the discussions and has also temporarily recused himself from the buyout firm.
Bouaziz had previously worked for PAI, starting in 2010 as a member of the food and consumer goods sector team and later running its portfolio performance group. He joined Ontex in January 2013.
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