GoCo Shareholder Polygon Plans to Vote Against Takeover Bid

GoCo Group Plc shareholder Polygon Global Partners LLP plans to vote against a takeover of the price-comparison company by the publisher Future Plc.

“We believe that GoCo is being sold for significantly below its intrinsic value and that the current terms favor disproportionally Future shareholders,” Bechara Nasr, a portfolio manager at Polygon, said in a phone interview. Polygon owns 5% of GoCo, Nasr said.

Future launched a cash and stock offer worth 136 pence per share for GoCo in late November -- a 23.6% premium to the previous close -- as part of its push into digital commerce. GoCo recommended the takeover, valued at 594 million pounds ($793 million) at the time, to its shareholders.

GoCo Shareholder Polygon Plans to Vote Against Takeover Bid

The buyer has a stable of specialist titles, including soccer publication FourFourTwo and equestrian magazine Horse & Hound, which it uses to gain insights into consumers and direct them toward certain brands. It plans to use GoCo, owner of the ‘Go Compare’ price-comparison site, to win more business with brand-marketing departments.

Nasr said that Polygon, which has been invested in GoCo since April 2019, likes the rationale of the deal, but thinks the combined group could exceed the roughly 10 million pounds in announced cost synergies and that revenue synergies could be greater by a fair margin.

“GoCo is an attractive combination of a strong branded cash-generating asset and a fast-growing disruptor, in our view together worth 150 pence before taking into account any control premium,” Nasr said. GoCo’s shares closed at 126 pence in London on Monday.

The deal requires the support of 75% of voting GoCo shareholders and already has the backing of Peter Wood, its chairman and largest shareholder, who owns almost a third of the company. The independent directors of GoCo, who are being advised by Morgan Stanley, have said they consider the terms of the deal to be “fair and reasonable”.

GoCo shareholders will own around 19% of the combined business.

©2020 Bloomberg L.P.

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