CareTech set for £870m takeover by co-founders
Social care provider CareTech is set to be taken private in an £870m deal spearheaded by its co-founders, the brothers Haroon and Farouq Sheikh.
AIM-listed CareTech, which provides residential care to children, young people and adults, said today it had agreed to a deal by Amalfi Bidco that will see shareholders pocket 750p per share.
Amalfi Bidco is a consortium assembled for the acquisition which includes Sheikh Holdings, set up by the Sheikh brothers, and fund management firm THCP Advisory.
The pair founded the firm in 1993 and floated CareTech on London’s Junior market in 2005, but said the move to take the firm private would be a positive one for shareholders.
“Both Haroon and myself as founders believe that our offer for CareTech is in the best interests of all stakeholders,” Farouq Sheikh said in a statement.
“As the management team who founded and grew this business, we believe that we are best placed to ensure long-term continuity of management and care for our service users.”
He added that shareholders are set for a significant premium to the share price in the short term. Under the terms of the deal, shareholders are in line to pocket around a 28 per cent premium on the closing share price on 4th March, the day before the offer period began.
News of the deal sent shares in the firm soaring over 20 per cent this morning.