GCP Asset Backed Income’s (GABI’s) board said it will begin a strategic review in the wake of an abandoned plan to merge with GCP Infrastructure Investments.
The board said the decision follows ‘extensive engagement’ with shareholders in connection with the failed merger discussions with GCP Infrastructure. It added that shareholders expressed views on both the proposed merger and the future of the company.
In the stock exchange announcement the board said that it is mindful of the importance of market liquidity to many shareholders, the discount to asset value and the limited scope for growing the company under current market conditions.
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Given all this, the options on the table are undertaking some form of consolidation, combination, merger or comparable corporate action; selling the entire issued share capital; selling all or most of the assets; a continuation under its current investment policy, alongside potential cash exit opportunities for shareholders; or an orderly wind-down.
The board also noted the opportunity for GABI to lend to borrowers in the prevailing higher interest rate environment.
Shareholders will be contacted in early January 2024 to gather their feedback.
The board also confirmed that in October it received cash takeover proposals from a US-listed investment company at 68 pence and then 72 pence per share, paired with share-based alternatives.
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The first proposal was unanimously rejected by the board, then the bidder withdrew before due diligence relating to the improved offer could begin.
