Get 40% Off
⚠ Earnings Alert! Which stocks are poised to surge?
See the stocks on our ProPicks radar. These strategies gained 19.7% year-to-date.
Unlock full list

Hedge fund Engine Capital urges Univar to consider sale, other options

Published 11/30/2022, 09:16 AM
Updated 11/30/2022, 12:51 PM
© Reuters

(Reuters) -U.S. hedge fund Engine Capital on Wednesday urged Univar (NYSE:UNVR) Solutions Inc to consider a sale or other strategic options, days after Germany's Brenntag SE said it was in preliminary talks to buy the chemicals distributor.

Engine Capital, which owns about 1% of Univar, said in an open letter that the bid by Brenntag confirms its view that the company is "undervalued" and a "highly attractive acquisition target".

While Brenntag and Univar did not disclose any financial details from their talks, Engine Capital said a sale price between $38 and $44 per share is achievable if the Univar board runs a competitive sale process.

It urged the company to publicly invite bids from other parties to begin the sale process.

"While we acknowledge the industrial logic of a combination between Univar and Brenntag, and believe the synergies would be material, we also note that private equity has been actively involved in the space," Engine Capital said in the letter.

Engine Capital on Wednesday also made public a letter it had sent to Univar in October, in which it said it favored Univar's sale to private buyers over public market investors.

In response to a Reuters request for comment, a Univar spokesperson said, "We value the view of our shareholders and we will continue to make decisions and take actions that we believe are in the best interests of the company and our shareholders."

Brenntag declined to comment.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.