Directors back takeover of Julia Ross’s recruitment firm despite expert declaring offer is not “fair”

The board of listed recruitment firm Ross Human Directions, founded by leading female entrepreneur Julia Ross, have re-iterated their support for a takeover bid from Malaysian company Peoplebank, despite an independent expert’s report finding the offer does not represent fair value.

An initial independent report in early October found the 70c-a-share bid was fair, but after RHD produced a better-than-expected result for the three months to 30 September, the experts were called back in.

But in the second expert’s report, the “fair” valuation for RHD was increased from 65-74c to 72-83c, meaning the 70c Peoplebank bid was no longer considered fair.

However, the board says it will continue to unanimously support the Peoplebank bid, unless a superior takeover offer is made.

In a statement to the ASX, the board said the bid still represented an 88% premium to the weighted average price of RHD shares over the past six months, and the bid would also give investors the chance to exit a relatively illiquid stock without paying brokerage.

The big question is whether rich list member Jack Cowin, who is best known as the owner of the Hungry Jack’s chain in Australia, will launch a bid for the company.

Cowin is the second-largest shareholder in RHD, with a stake of 19.88%, and has opposed Peoplebank’s takeover bid for being too low.

He told The Australian Financial Review he is still considering whether he will make a full takeover offer for the company.

The big winner from the takeover tension is Ross, who is the biggest shareholder in RHD with a stake worth about $25 million.