CA - Canaccord committee hires bank to seek alternatives to management buyout

The special committee of Canaccord Genuity Group's ( OTCPK:CCORF ) board has hired Barclays Capital Canada ( BCS ) to explore alternative transactions to a C$11.25 (US$8.29)-per-share takeover offer from Canaccord's management team, it said Monday.

The committee, saying it does not support the offer at the current price, repeated that the transaction proposed by some members of the company's management team undervalues the company. Canaccord ( TSX: CF:CA ) shares rose 1.2% to C$11.57 Monday morning in Toronto trading.

As such, it intends to recommend that shareholders not tender to the offer, the committee said. The committee cited independent valuation provided by RBC Capital Markets that, as of Feb. 15, puts the fair market value of Canaccord's ( OTCPK:CCORF ) common shares in the range of C$12.75-C$15.75 per common share, or 13%-40% more than the current offer price.

The committee and the management group have not been able to reach an agreement on an improved offer. "As a result the special committee has engaged Barclays Capital Canada Inc. to commence an alternative transaction process to explore strategic potential strategic alternatives to enhance shareholder value," the special committee said.

In January, the company said a management group led by President and CEO Dan Daviau and Chairman David Kassie had intended to make a takeover bid for the company at C$11.25 per share.

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