Australian Pharmaceutical Industries has knocked back Wesfarmers $687m takeover offer, as revealed in The Australian on Wednesday.
In a statement on Thursday morning, API says the $1.38 a share offer undervalues the company following a review of it proposal.
“The board has unanimously concluded that the Indicative Proposal undervalues API, is not compelling and is not in the best interests of API shareholders,” API says.
API gave a number of reasons for rejecting the offer including that the bid was “opportunistic” due to the impacts Covid-19 have had on the company’s retail operations, which includes Priceline Pharmacy, over the last 18 months.
“The board notes that the indicative proposal implies a premium of 18.7 per cent 1 to the 3-month volume weighted average price which is significantly below the Australian market average for transactions of this nature,” API says.