The best performer on the All Ordinaries index on Thursday has been the Wellcom Group Limited (ASX: WLL) share price.
In late morning trade the Australian production and content management company's shares are up over 28% to $6.76.
Why is the Wellcom share price rocketing higher?
This morning Wellcom revealed that it has received a takeover approach from South Korean full-service global advertising agency Innocean Worldwide.
According to the release, Wellcom has entered into a scheme implementation deed with Innocean Worldwide under which it will acquire all of the issued share capital of Wellcom, except for a 15% stake held by Wellcom's Chairman Wayne Sidwell, for $6.70 in cash per share by way of a scheme of arrangement.
This represents a 27.6% premium to the last close price and values Wellcom at $265.8 million on a fully diluted equity basis.
The directors of Wellcom have unanimously recommended that shareholders vote in favour of the scheme in the absence of a superior proposal and subject to an independent expert concluding that it is in their best interest.
Chairman Wayne Sidwell said: "Innocean's offer for Wellcom shares reflects Wellcom's leading market position and the strength of its underlying businesses. It will be business as usual under Innocean's ownership and I am looking forward to continuing with Wellcom as an executive and shareholder. Innocean's ownership will provide a great opportunity for Wellcom's businesses and people by offering a larger geographical footprint and new opportunities in complementary business channels."
The company also revealed that it will continue to pay its special dividend of up to 10 cents per share and a final dividend of up to 11 cents per share on or before the implementation of the scheme.
Pleasingly for shareholders, both will be franked to the maximum extent possible and the scheme consideration will not be reduced by either amount.
What now?
A scheme booklet containing information relating to the proposed acquisition, reasons for the directors' recommendation, an independent expert's report, and details of the scheme meeting and timetable will be prepared and provided to shareholders in October 2019.
Until then, the release advises that Wellcom shareholders do not need to take any action at the present time.
Also rising strongly on the All Ordinaries on Thursday has been the Strike Energy Ltd (ASX: STX) share price following an update on its Wagina gas discovery and the Polynovo Ltd (ASX: PNV) share price after a positive trading update. Their shares are up 10% and 7%, respectively, at the time of writing.
