Greencross Limited (ASX: GXL) announced that it will pay a special dividend if the takeover by TPG Asia is approved.
Greencross is the $660 million pet company behind brands such as Pet Barn, Greencross Vets, City Farmers and more. It has more than 230 retail stores and over 160 veterinary clinics Australia wide.
The Greencross Takeover And Special Dividend
Greencross has been in takeover talks since the beginning of October 2018, when it released a public statement after media speculation.
The takeover of $5.55 per share, less any dividends, was made by a subsidiary of private equity firm TPG Asia. The offer was unanimously recommended by the Greencross Board.
Today Greencross announced that it will pay a special fully franked dividend of $0.19 per share if the scheme for takeover is approved and implemented. The special dividend record date is expected to be Wednesday 13 February 2019.
Greencross said that it will hold the scheme meeting for shareholders on 6 February 2019.
Is Greencross A Buy For Its Special Dividend?
At this late stage of the takeover I feel there’s very limited gains to be had in Greencross and it may be better to deploy your money elsewhere. Somewhere it has a better chance of growth, as ultimately the returns are almost set in stone from Greencross at this point.
However, investing in takeover companies like Greencross is the type of play that investors such as Luke Cummings from Harvest Lane Asset Management would be interested in. You can listen here to learn how Luke finds takeover companies. He was recently profiled in the podcast with Rask Group’s founder, Owen Rask. He talks at great length about the pros and cons of buying shares which are subject to takeovers.
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Disclaimer: Any information contained in this article is limited to general financial/investment advice only. The information has not taken into account your specific needs, goals or objectives, so please consider consulting a licenced and trusted adviser before acting on the information. Please read The Rask Group’s Financial Services Guide (FSG) for more information. This article is authorised by Owen Raszkiewicz of The Rask Group, which is a corporate authorised representative No. 1264179 of Strawman Pty Ltd (ACN: 610 908 211) (AFSL: 501 223).