The news that PSA had left the fighting ring saw London shares end the day’s trading at 516.50p, having opened on the same day at 537.5p. PSA had declined to offer above 470p, saying that to have done so would not have made good commercial sense. DP World had trumped that offer with its own 520p.
In a statement issued on Friday, P&O directors recommended unanimously that shareholders accept the revised DP World offer. They added that “the combination of P&O and DP World has compelling strategic logic and will create significant opportunities for both businesses and their employees.”
Dubai’s bid offers a 71.3% increase on the share price compared to before market speculation on the takeover began.
The news was expected by industry insiders but rumours as to motivations still abound. Some have suggested that PSA never intended to win, and instead forced DP World to up its offer so as to make it difficult for the operator to cut prices. The 470p offer forced DP World to increase its own offer by 17%.
PSA will not lose out completely though. It has a stake in P&O and will itself profit from DP World when it sells its 4.1% stake. DP World is purchasing P&O for a record US$6.8bn, a billion above the expected price tag, following PSA’s offer.