The directors of Lees Foods have launched a GBP5.6m (US$8.9m) takeover bid for the Scottish cake maker.

Randotte, a company formed by the group’s directors for the purposes of the acquisition attempt, have offered 230 pence per share in a bid to acquire 100% of Lees’ outstanding share capital.

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The offer price represents a 12.5% premium on the weighted average closing price for Lees shares over the past six months and a 2.7% premium of the closing price of 224 pence on 5 April, the last trading day before the announcement.

The takeover will be funded by debt finance to Randotte, the company said in an announcement today (10 April).

Lees directors Clive Miquel, David Simson, Albert Croll, Nadia Millar and Klaus Perch-Nielsen are all Randotte directors and, subject to closing of the deal, will all be Randotte shareholders. They are therefore not considered independent for the purposes of the acquisition.

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However, current Lees shareholders have been advised to vote in favour of the scheme by Shore Capital, who have acted as independent financial advisors to the board.

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In a regulatory filing, Lees said Randotte has received “irrevocable undertakings” from certain shareholders to vote in favour of the scheme. As of 5 April, these shareholders represented approximately 40.9% of the scheme shares. 

Shares in Lees Foods rose by 2.68% immediately after the announcement, increasing to 230 pence per share at 10.50am.