On 12 March 2019, IPH Limited made a shock takeover offer for Xenith IP Group Limited. You can read about it here.

The Xenith Board has finally responded with its recommendation to shareholders. You only need to read the title of its response to know which way the Board went: “Xenith Board responds to IPH’s unsolicited proposal”.

The Xenith Board says no to IPH’s offer. It says that Xenith shareholders will only have a fraction of the board representation that they would have with the alternative proposal which is a meger with QANTM Intellectual Property Limited.

What that effectively means is that the Xenith Board is recommending that it not become redundant. 

Another point made by the Board is that there is a significant risk that ACCC will not give clearance to the takeover.

Other reasons for rejecting IPH are also provided, including an offer price that the Board believes is too low.

The Xenith Board is recommending to continue along the path of the merger with QANTM. 

What will IPH do next? If it does nothing, it will be able to cash-in its Xenith shares if and when they increase to a more attractive level.