The McPherson’s (ASX:MCP) share price fell 15% today. What happened?

The health and beauty company’s shares took a dive today after it announced a takeover proposal would not be going ahead.
The post The McPherson’s (ASX:MCP) share price fell 15% today. What happened? appeared first on The Motley Fool Australia. –

The McPherson’s Ltd (ASX: MCP) share price had a doozy today. McPherson’s shares fell a nasty 15.22% today to $1.22 by the end of trading.

That came after the health and beauty company closed at $1.44 per share last week and opened at $1.22 this morning. This means the company has lost its slender gain for 2021, and the shares are now down 14.34% year to date. The company is also down 56.25% over the past 12 months.

So what went wrong today?

McPherson’s many suitors

The fall in the McPherson’s share price can probably be blamed on an ASX release to investors before market open.

In this release, McPhersons advised the takeover proposal the company received in April from Arrotex Australia Group Pty Ltd will not be going ahead.

Back in April, McPherson’s announced Arrotex had put forward a “non-binding, indicative proposal” to acquire 100% of McPherson’s shares at a price of $1.60 per share. The offer was an all-cash one.

Prior to that, McPherson’s had received a different offer, this one from Gallin Pty Ltd. Gallin put up an offer of $1.40 per share. However, the McPherson’s board advised shareholders to reject this offer.

Earlier this month, McPherson’s gave investors an update on the Arrotex proposal. It noted the following:

The Arrotex Indicative Proposal is conditional upon completion of satisfactory due diligence to be undertaken over a four-week period pertaining to accounting, financial, legal and key operational areas, and a number of other customary conditions.

Well today, here’s what McPherson’s had to say on the proposal from Arrotex:

After providing Arrotex with the agreed four-week due diligence period, the board wishes to advise that the parties have agreed to cease due diligence and Arrotex has withdrawn its indicative proposal.

So close perhaps, but no cigar.

Wedding called off

Here’s some of what McPherson’s CEO Grant Peck said on the outcome:

Following today’s announcement in respect of Arrotex, I now look forward to working with the board to continue to implement the outcomes of our operational review announced on 19 May 2021.

We have a clearly defined strategy and are focused on its execution to deliver significant value to our shareholders in the short and long term… The McPherson’s team will continue to focus its attention on delivering our health, wellness and beauty strategy.

At today’s closing share price, McPherson’s has a market capitalisation of $156.75 million, a price-to-earnings (P/E) ratio of 92.04 and a trailing dividend yield of 8.57%.

The post The McPherson’s (ASX:MCP) share price fell 15% today. What happened? appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of May 24th 2021

More reading

Why Austal, Cettire, Leigh Creek Energy, & McPherson’s are sinking today

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!