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UPDATE: PMP responds to takeover speculation

Thursday, 12 October 2006
By Print21
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David Rowland, company secretary for PMP, says the company has a policy of not responding to market speculation and rumour, but its hand was forced when it received a specific request from the Australian Stock Exchange to explain the sudden spike in the company’s share price.

“Like many other companies, PMP has been approached by private equity. No firm offer to acquire PMP has been made,” says Rowland.

PMP has declined to offer any other reason for why the company’s share price has risen so sharply over the last week.

“PMP is not aware of any explanation for the recent price change and increase in volume of it’s trading shares,” other than the approach from private equity, the statement says.

PMP has not revealed which particular private equity firm the approach has come from, but reports in The Age speculate that CVC Asia Pacific, part of Citigroup, may have been the company behind the approach.

The ASX announcement caused PMP’s share price to skyrocket further, rising 16 cents yesterday, or 9.28 per cent, to $1.88 – the company’s biggest one-day gain in three years and its highest level since 2001.

Share price rise triggers PMP takeover speculation

As Australia’s largest printer lays down three million copies of the Telstra prospectus, a sudden bump in share price has ignited private equity rumours.

PMP stock shot up 13 per cent this week, with reports stating that private equity groups are sizing up the print group for an impending bid. Rumours abound that two private equity funds are currently looking at PMP, one being CHAMP, according to the Australian Financial Review.

The company has so far managed to avoid a formal query on the Australian Stock Exchange and Brian Evans, chief executive officer of PMP, has indicated he has no formal knowledge of any impending bid. But industry speculation is flying that a hedge fund is sitting at just under five per cent ownership of PMP shares and gearing up for further action.

While nothing is concrete at this stage, the speculation comes at a time when PMP is ramping back up to full capacity after the completion of a series of high-profile MAN Roland press installations. Evans commented earlier this year that the tonnage is coming back to the company now its capacity restraints have been lifted, a claim reflected in the thee million copies of the Telstra 3 prospectus that PMP is printing for potential investors in the last stage of the Federal Government’s telecommunications sell off.

“One issue we’ve focused on is securing as many long-term contracts as we could given we’re now back to full capacity. From that perspective, we’re very comfortable, and we now have the ability to be more choosey about the work we go for,” Evans said in August.

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