“There is no certainty that any transaction will occur. The Tabcorp board is assessing the proposals and Tabcorp will update the market in due course,” it said.
Shares in the $9.1 billion firm rose 11.7 per cent to a near 12-month high of $4.58 on the news,and closed up 8.78 per cent to $4.46.
Investors such as Perpetual,John Wylie’s Tanarra Capital and Investors Mutual were agitating for change last year which led to the departure of chairwomanPaula Dwyerin December. Tabcorp’s chief executive David Attenborough is due to follow her out the door this year.
Tabcorp investor Sandon Capital has gone further by advocating for a split of the business to deliver value to investors. “It validates our view that there is interest in the business and that market prices previously have not reflected anywhere near its true value,” Sandon Capital managing director Gabriel Radzyminski said.
“When we wrote to the company in November,we believed it was now the time to rethink the whole strategy,plus there was the change of chair,” he said.
“That effectively means it’s a new board because the dynamics change. It was an opportunity for a new board to start with a blank sheet of paper and say,right,here’s what we’ve got. But what should we be?”