Bank of England banknote printer set for bidding conflict after rival provide

A takeover battle looks set to erupt for the Bank of England’s currency printer after a rival offer reportedly emerged after an earlier bid had already been accepted. 

De La Rue revealed on Tuesday morning that it had struck a £263million acquisition deal with the American private equity firm Atlas Holdings.

The 130p per share offer represents a 19 per cent premium to the company’s closing price on 11 December, the last day before the recent offer period began.

But Sky News reported soon afterwards that Pension SuperFund Capital, the investment vehicle of City financier Edi Truell, had told De La Rue’s board of his plans to make a 132.17p per share bid.

De La Rue has not yet confirmed Truell’s alternative offer.

De La Rue shares surged 17 per cent to 131p on Tuesday morning following the takeover announcement, taking gains over the past year to around 65 per cent.

A takeover battle looks set to erupt for the Bank of England’s currency printer after a City financier reportedly put forward a higher proposa

Atlas’s proposal does not include the group’s authentication division, which it intends to sell to industrial technology company Crane NXT for £300million at the start of May.

De La Rue said Atlas’s ownership would ‘better position’ the business for further investment and help it navigate the ‘cyclical and competitive’ nature of the currency market.

Based in Connecticut, Atlas owns British construction group Bovis and the graphic and creative services agency ASG.

Founded in 1821 by Thomas de la Rue, the firm prints over half the world’s banknotes, including the new sterling notes featuring King Charles III, but also produces security features for identity documents.

The Basingstoke-based company struggled following the Covid-19 pandemic as the surge in contactless payments hit demand for paper cash.

Troubles were exacerbated by the loss in 2018 of a massive UK Government contract to print post-Brexit passports, an economic crisis in Sri Lanka, and higher microchip and raw materials costs.

In the six months ending 28 September, De La Rue reported its turnover declined by 10.2 per cent to £145.1million, mainly due to some contract deliveries in its currency segment shifting into the second half of the financial year.

Peter Bacon, operating partner at Atlas, said: ‘In De La Rue, we see a company that is an industry leader, but one which has faced multiple challenges in recent years.

‘We believe that our strategic resources and capital will be able to support and enhance the De La Rue business going forward.’

Clive Vacher, chief executive of De La Rue, added: ‘Atlas is the right partner to take De La Rue into its next phase of growth.

‘Most importantly, under Atlas’s ownership, we can ensure long-term stability for our customers and our people and best position the business for its next chapter.’

De La Rue’s anticipated takeover comes amid a flurry of activity involving foreign predators buying London-listed firms at discounted valuations.

Just last week, NHS landlord Assura accepted a £1.6billion offer from a consortium consisting of investment companies Kohlberg Kravis Roberts (KKR) and Stonepeak Partners.

Sixty businesses worth a combined £59.4billion left the London Stock Exchange last year because of acquisitions, according to financial data group Dealogic.

Among those to delist were cybersecurity giant Darktrace, video games services provider Keywords Studios, and music catalogue owner Hipgnosis Songs Fund.