Caltex rebuffs takeover price but open to revised bid
Angela Macdonald-Smith

Takeover target Caltex has determined that a $8.6 billion cash offer from Canada’s Alimentation Couche-Tard “does not represent compelling value” for shareholders but has offered its suitor greater access to its financial accounts so it can work up a higher offer.

Caltex said on Tuesday that after carefully considering the proposal and taking advice from advisors and feedback from shareholders, it decided the offer undervalues it.

It cited several factors behind its decision, including that Caltex is at a low point in its earnings, the opportunities available in the convenience retailing business and the proposed initial public offer of convenience retail sites which it said would unlock value for shareholders.

Canadian firm Alimentation Couche-Tard has Caltex in its sights. Supplied

“Caltex has a well-developed strategy, privileged assets, strong leadership and compelling growth opportunities that the Board believes will deliver attractive value for its shareholders over time,” chairman Steven Gregg said in a statement.

“The Caltex Board is focused on maximising shareholder value and will carefully consider any proposal that is consistent with this objective.”

Couche-Tard, based in Quebec, is offering $34.50 a share, having already lifted its initial approach from $32. But the offer would be reduced by the expected payment of a dividend for this December half.

Shares in Caltex closed on Monday at $34.76.

Caltex noted there was no certainty the talks with Couche-Tard would result in a revised takeover proposal.

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