Peoplebank founder attempts to take business private

The founder and managing director of recruitment firm Peoplebank is launching a takeover bid against his own company, along with its largest institutional shareholder, Navis Capital Partners.

If successful, managing director Leon Lau says the company will be delisted, making it the second privatisation bid in one week, after the founding family behind Village Roadshow announced they are preparing to acquire the rest of the company and delist it.

Following the close of trading yesterday, the entity making the bid, known as PB Recruitment, announced it had made a cash offer of 60c per share, which values Peoplebank at about $58.4 million.

Yesterday Lau told The Australian Financial Review that he thought the bid offers an opportunity for shareholders to determine whether they can see a valuable return from their investment.

“Generally speaking there has been a movement from recruitment stocks because of the cyclical nature…clearly, I think it is currently undervalued.”

The offer is a 39.5% premium of the share price of 43c on 11 August, and a 59% premium of the volume weighted average of the price of Peoplebank shares at 37.7c for the six months ending 11 August. The offer will close on 29 September 2009.

Peoplebank recorded 8.7% growth during the 2007-08 year, with revenue growing from $137 million to $149 million.

PB Recruitment currently has an interest in 77% of Peoplebank’s shares. Chairman Tom Beecroft said in a statement to the ASX that “the offers provide a certain and straightforward cash exit for Peoplebank shareholders from an illiquid stock.”

He also said “the likelihood of another bidder emerging is extremely remote”.

PB Recruitment is a subsidiary of Navis Capital Partners, which has completed about 40 acquisitions in the last 11 years.