For now, the company is advising shareholders to take no action in respect of Science Group’s 35p a share offer, even though the prospect of a better offer that the Frontier board dangled before its shareholders now appears to be more of a joint venture proposal than a full takeover.
Furthermore, the digital radio and internet-of-things technology specialist admitted there is next to no prospect of the talks with what it called “a credible industry player” yielding a heads of terms agreement by 16 July, the closing date of the Science Group offer.
The exact structure and ownership of the joint venture, including the assets to be transferred into it, remains subject to negotiation; as does the implied valuation and capitalisation of the joint venture, Frontier Smart said.
In the opinion of the Frontier board, if negotiations with the credible industry player were to be successfully concluded, the deal would likely present the prospect of material incremental potential value for Frontier, its shareholders (which include Science Group) and other stakeholders.
Frontier said it wants to open collaborative discussions with Science Group and its advisers with a view to agreeing on a route forward which preserves the potential value upside for all current Frontier shareholders.
Shares in Frontier nudged up 1.1% to 35.9p in early deals.