I am happy with the way matters are moving here.

trend heading towards bounce

Just had a dabble @221.67

gl skinny - it would be rude not to!!

auto trades flying through and being mopped up

lol when the dust settles people will realise they have got a 5.2billion additional acquisition in at a cost of a 2billion rights issue - now unless i am thick that is good business even if ri @ 122 - this was a strategic necessity - unfortuhately many stop loss casualties on the way

but they can buy back when they catch up

7 for 6 @ 122 do me fine - got to be in it to get it!! lol

bouncing a bit now

at last people are waking up - sp heading north - blimey that took some time! gla

skinny - kerrrrrrrrchinnnnnnnnnnnnnnnnnnggggggggggggggggggg

gl

auction

today better!!!

well chuffed - what a result today - yeeeeeeeeeeeeeeehaaaaaaaaaaaaaaa

skinny did you sell today or still hanging on - gl

I had a limit in which didn't get hit - so I'm still in.

Graham Ruddick, 6:16, Wednesday 19 October 2011

The chief executive of G4S (Other OTC: GFSZF.PK - news) will fly to America on Wednesday in an attempt to secure backing from key shareholders after City analysts warned his 5.2bn deal to buy ISS is at risk of being voted down.

On Tuesday, G4S was hit by a string of downgrades as analysts expressed concern at the amount of debt the security group will assume, how it will manage 1.2m staff, and why the group, based in Crawley, West Sussex, is moving away from its strength in security.

Analysts at Citi raised the prospect of G4S shareholders rejecting the deal and the 2bn rights issue which will finance it, upgrading their rating on the company partly because the acquisition could collapse.

Nick Buckles, the chief executive of G4S, is understood to be travelling to the US to meet key investors such as Harris Associates, BlackRock (NYSE: BLK - news) and Marathon Asset Management, who are top 10 shareholders.

The leading investors in G4S were quiet on the deal on Tuesday but shares in the group recovered 9.8pc, or 21.6p, to 241p. G4S shares crashed by 22pc on Monday after the company announced it wanted to buy the cleaning and catering provider ISS.

Copenhagen-based ISS is owned by EQT Partners, the private equity arm of Sweden's Wallenberg family, and GS Capital Partners, Goldman Sach's investment division. G4S will pay the investors 1.5bn in cash and shares, leaving them with a stake of 11.3pc in the enlarged company, and assume 3.7bn of debt.

The prospectus for the deal shows ISS has lost money on a pre-tax level for at least the past three years, despite revenues of more than 7bn, because of financing costs on the debt.

Citi said it was basing its 300p target price on G4S not acquiring ISS and adding "75pc of attending votes at the November (Stuttgart: A0Z24E - news) 2 emergency general meeting [EGM] are required to approve the 390m G4S share issue to ISS's vendors. With EGM attendance unlikely to reach 100pc, perhaps only 15pc to 20pc of outstanding equity would be needed to block the transaction."

David Brockton, at Espirito Santo, warned: "From an opportunity/cost perspective, the acquisition of ISS will limit the group's ability to deploy capital to accelerate growth in other business areas, with faster underlying growth eg emerging market security. As such, we are yet to be convinced that the end justifies the means."

hi dc - yep i have heard that today too but others at citi disagree - depends who one asks really - bit of a debate going on

the yes camp at citi are citing synergies etc - the no camp the obvious in the box stuff

its up in the air from here!!! monitoring closely

gl skinny

may well get voted down though so may need to put my gambling hat back on lol! buckles needs to sell this well or .....

Good luck gibby and skinny, Just keep an eye and i am sure you will not go wrong. dc

Just closed 242.6

nice one well done skinny

More news

G4S shareholder Parvus says 5.2bn ISS deal is 'dangerous'


Graham Ruddick, 20:58, Thursday 20 October 2011

One of the largest shareholders in G4S (Other OTC: GFSZF.PK - news) has said it will vote against the 5.2bn acquisition of cleaning group ISS, calling the deal "dangerous".

London-based hedge fund Parvus Asset Management is the third-largest shareholder in security group G4S with 3.7pc and is the first investor to publicly express its opposition to the deal.

Parvus founder Edoardo Mercadante told The Telegraph on Thursday that the 5.2bn deal "jeopardises the future health of the company" and "doesn't make sense" given G4S's success in security since founding in 2004.

Shareholders will vote on the deal on November (Stuttgart: A0Z24E - news) 2, but G4S already appears to be facing a rebellion from at least one investor. A second top-20 shareholder said the acquisition of ISS is "absurd" and "totally unnecessary".

G4S needs 75pc of voters to support the deal or it will collapse. Nick Buckles, chief executive, believes buying ISS will allow G4S to offer a wide range of services to customers. The company is financing the deal with a 2bn rights issue and 3.7bn of new debt facilities.

However, Mr Mercadante said: "I don't think they need to go into cleaning and basic services with such leverage and a big step."

He said the acquisition was a "big strategic change" given that Mr Buckles had previously spoken about expanding G4S into higher-margin specialist security and emerging markets. It is understood Mr Buckles instead decided to turn G4S into a provider of integrated services after a strategic review by consultants Bain earlier this year.

Parvus has been invested in G4S through contracts for difference since April 2010. These were swapped into shares on Wednesday. The number of hedge funds with a position in G4S is expected to rise because of the sharp fall in the share price since the deal was announced and the possibility of the deal not completing.

In a note on Thursday, analysts at Collins Stewart (Other OTC: COLLF.PK - news) said the ISS deal "destroys significant shareholder value" in G4S. They were using their analysis service Quest, which calculates the value of businesses on the basis of cashflow.