James Gilinski, a banking billionaire, is going to meet the shareholders of Colombian food producer Grupo Nutresa SA this week with a new offer of $ 2.2 billion for a takeover. This is the most significant attempt he has made in his career, lasting several decades.
One of the richest men in Colombia, Gilinski, said that the shareholders should seriously take his offer to buy the majority of shares. The offer for the Medellin-based Nutresa is at a 38% percent premium over the share’s closing price before the deal was announced this month.
As per Bloomberg news, the offer was at $ 7.71 share in cash either in dollar or Colombian pesos and will close December 17. The details were published in El Tiempo newspaper, Sundays’ edition.
According to Gilisky, his offer to the shareholders represents a fiduciary responsibility to them, and this is a massive opportunity for the shareholders, he said in an interview in Miami.
According to a notice in El Tiempo, Gilinski and his son Gabriel have partnered with the royal family of Abu Dhabi to buy out a minimum of 50.1% or a maximum of 62.6% shares via the Royal Group, an investment vehicle. Letter of credit by First Abu Dhabi Bank and Banco GNB Sudameris for $1.08 billion and an equivalent in pesos of $23 million respectively have been provided.
In a career spanning four decades, this is the largest acquisition attempt by Gilinski.
The Medellin-based company is part of a business group known as GEA or Grupo Empresarial Antioqueno. This group has a cross-holding structure that staves any buy-out bids. Grupo Argos SA and Grupo de Inversiones Suramericana SA hold a combined 45.3% of the Nutresa shares and another 5.2% stake held by overseas funds of Proteccion SA, a pension fund Manager. The key to the takeover bid lies with the approval of these conglomerates.
According to data from Bloomberg, share prices have gone down by more than 50% in terms of dollar value over the past decade. Gilinski, armed with Colombian regulators’ approval, will meet the investors and make a presentation on his rationale for buying out the company at a value that represents the shareholders.
Gilinsky feels that Nutresa is an excellent and well-run company, and the CEO and management are highly respected, the market value of its shares is not reflected correctly. This needs to be taken up seriously now.
Gilinski wants to keep Nutresa to continue being based out of Medellin if his bid is successful. In addition, he will open new markets for selling the company’s coffee, chocolate, cold cuts, and snacks, including the Middle East.
In the 1990s, Gilinski, now 63, entered the banking sector and developed a multi-billion empire that spread across industries like media, real estate, and financial services. He owns the Four Seasons hotels, a Bogota news magazine, and near the Panama Canal, a massive real estate development on a former air force base.
Gilinsky, a Harvard Business School graduate, has an estimated net worth of $ 4.3 billion, according to Bloomberg. He is also on the board of Bogota-based Banco GNB Sudameris.
