Top UDG shareholder says private equity bid undervalues company

DUBLIN, May 21 (Reuters) - The largest shareholder in London-listed UDG Healthcare said a $3.7 billion offer for the company from private equity firm Clayton, Dubilier & Rice was “opportunistic and significantly undervalues UDG and its prospects”.

Allianz Global Investors, which has an 8.6% holding in UDG, said it was “minded not to accept the current offer despite it being recommended to shareholders by the Board of UDG”.

CD&R agreed to buy UDG for 2.6 billion pounds ($3.7 billion) in cash on May 12.

“Having come through the trials of the pandemic with a strong balance sheet, AllianzGI believes UDG can realise the potential of recent acquisitions, consider further inorganic opportunities and improve the efficiency of its capital structure,” Allianz GI said in a statement.

CD&R has agreed to pay 10.23 pounds per share in UDG, representing a premium of 21.5% to the closing price the day before the offer was made public. The shares traded at 10.43 pounds at 1415 GMT on Friday.

The deal was one in a series of private equity moves for London-listed companies in recent weeks

UDG, which has its headquarters in Dublin, specialises in healthcare advisory, communications, commercial, clinical and packaging services.

A spokeswoman for the UDG declined to comment when contacted by Reuters.

Reporting by Graham Fahy Editing by Keith Weir