Pacific Smiles Group's response to takeover bid

Pacific Smiles Group Limited (ASX:PSQ) has issued a Target's Statement in response to an off-market takeover bid made by Beam Dental Bidco Pty Ltd for all of the fully paid ordinary shares in Pacific Smiles. The company's board has unanimously recommended shareholders to reject the Offer from Genesis Bidco by taking no action. The reasons for the recommendation include the Offer being subject to conditions that are not currently capable of being satisfied, being materially below the previous $2.05 NDC Scheme, and not improving upon Genesis Capital's prior proposal received in July 2024, despite Pacific Smiles' strong operating performance and cash generation. The Offer is also considered opportunistically timed, and Pacific Smiles is seen as a leading dental service organization with attractive prospects and a net cash position that makes it well placed to invest in identified growth opportunities and/or return capital to shareholders.

Executive commentary on the takeover bid

The company's board has carefully considered the takeover bid and unanimously recommends shareholders to reject the Offer from Genesis Bidco. The Offer is deemed to be below the previous $2.05 NDC Scheme and does not reflect the company's strong operating performance and cash generation. We believe that Pacific Smiles is well positioned to pursue growth opportunities and enhance shareholder value. The Target's Statement provides detailed information for shareholders to make an informed decision regarding the Offer.

Implications and outlook

Pacific Smiles Group Limited has recommended shareholders to reject the takeover offer from Genesis Bidco, citing the Offer's conditions, valuation below the previous proposal, and the company's strong performance. The company emphasizes its attractive prospects and net cash position, indicating its ability to invest in growth opportunities or return capital to shareholders. Shareholders have been provided with detailed information on the implications of accepting or rejecting the Offer, along with the available options. The company's future outlook is focused on leveraging its position as a leading dental service organization to drive growth and enhance shareholder value.