A powerful shareholder body whose members manage assets worth £14tn has waded into the multi-billion pound takeover of Worldpay, the FTSE-100 payments group.
Sky News has learnt that the Investor Forum, whose members include City institutions such as Legal & General Investment Management and Schroders, has held a series of talks with Worldpay over the terms of its £9bn sale to Vantiv of the US.
City sources said on Thursday that the Investor Forum had intervened in order to make clear its members’ dissatisfaction with the modest takeover premium that Vantiv is proposing to pay.
The deal is being described as a merger, with several Worldpay executives expected to play key roles in the combined group after its completion.
However, City institutions are demanding that the new US-headquartered company commits to retaining some form of public listing in London that would allow them to continue holding the shares.
“Either this is a takeover, in which case Vantiv needs to pay an appropriate premium, or it’s a merger, in which case UK fund managers want continued access to an attractive high-growth company,” said one investor.
“That’s why the Investor Forum needs to be involved.”
The Forum’s engagement in discussions is rare in a takeover situation, and underlines the strength of feeling among some City fund managers about the shape of the prospective deal.
The body was established following a review commissioned by Sir Vince Cable, the former Business Secretary and now leader of the Liberal Democrats.
Since it was set up three years ago, it has engaged with companies such as Standard Chartered and Sports Direct during periods of concern about corporate governance or broader business performance.
While it has no formal powers, the Forum’s members are among the world’s most influential investors.
Its board members include Robert Swannell, the outgoing chairman of Marks & Spencer.
Sky News revealed last week that advisers to Vantiv and Worldpay were haggling over the future status of its British operations as they seek to agree a deal ahead of a revised deadline next week.
While sources say that Vantiv’s announcement of a binding offer for Worldpay is unlikely to make a formal commitment to retain British jobs, the UK-based company’s advisers are keen for it to pledge to locate the merged group’s international head office in Britain.
An initial agreement on the key terms of the £9bn deal earlier this month said that Worldpay’s shares would be delisted from the London market, adding that there would be “hubs in the UK, Europe and US”.
A source close to Worldpay said the company was “listening to and engaging with shareholders”.
Vantiv looks like being the only potential buyer of Worldpay after JP Morgan Chase, the giant American bank, decided against a bid.
Global Payments, another New York-listed company, is understood to have examined a counterbid, but bankers say the prospects of it trumping Vantiv are remote.
The likely takeover of Worldpay will come two years after it was catapulted into the FTSE-100 after its flotation.
The British company, which is run by Philip Jansen, used to be owned by Royal Bank of Scotland, which was forced to sell Worldpay as part of the lender’s bailout deal with Brussels.
Some shareholders have complained that Vantiv’s offer values Worldpay too cheaply, while Sir Mike Rake, the FTSE-100 group’s chairman, said that the impact of Brexit on sterling was to blame for its vulnerability to a takeover.
Worldpay, Vantiv and the Investor Forum all declined to comment.
Source: Sky