Another Top Daily Mail Holder Slams U.K. Media Baron’s Bid as Unfair

(Bloomberg) -- A second major shareholder of Daily Mail & General Trust Plc has come out in opposition to media mogul Lord Rothermere’s bid to take the British newspaper publisher private. 

J O Hambro Capital Management Ltd. isn’t currently planning to accept the offer, which it says isn’t fair and doesn’t reflect the long-term value of the company’s assets, according to an emailed statement Friday. The fund manager said it owns 3.3% of DMGT’s publicly-traded class A shares and advises on a further 2.6% stake.

The investment firm was “underwhelmed and unconvinced” by DMGT independent directors’ arguments and sees a “lack of detail and rigor” in valuing the assets, according to the statement. The Rothermere family’s bid of 255 pence per share for DMGT’s remaining business is only 50% of its base case valuation and around 25% of its most bullish estimate, J O Hambro said. 

An investment vehicle controlled by Rothermere, who’s also known as Jonathan Harmsworth, has agreed to take DMGT private in a complex 2.6 billion-pound ($3.5 billion) breakup that involves selling off a range of other businesses. Investors would get a total of 1,263 pence per share under the deal, including proceeds from a previously announced asset sale as well as well as stock in auto marketplace Cazoo Group Ltd. and a cash offer for the rest of DMGT. 

A representative for Rothermere’s holding company declined to comment, while a spokesperson for DMGT couldn’t immediately be reached. 

J O Hambro’s opposition comes after Majedie Asset Management Ltd. said it would oppose the offer. Majedie, which owns 4.6% of DMGT’s class A shares, said this month the bid “is substantially below what we believe is a fair and reasonable valuation.”

The bid from Rothermere requires acceptance from 90% of shareholders to go through, though he has the option to reduce that threshold. 

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