De La Rue dives as Oberthur walks away

24th Jan 2011 16:24

Shares in banknote printer De La Rue dived ahead of the close Monday after rival Oberthur said it will not make an offer for the company following De La Rue's rejection of a 935p-a-share bid.Oberthur increased its offer for De La Rue to 935p from 905p previously, but De La Rue said the proposal "continues to undervalue significantly the strong fundamentals of the company and its long term prospects."Oberthur said it was 'disappointed' by De La Rue's swift rejection of the bid and seemed to question De La Rue's wisdom in doing so."Bearing in mind the significant difficulties being encountered by De La Rue and the structural changes occurring in the global banknote paper market, shareholders in De La Rue may now ask themselves how long it will be before the market price of De La Rue shares attains the level of the increased proposal," Oberthur said.Chairman Nicholas Brookes said Monday morning that, having appointed a new chief executive, Tim Cobbold, to lead a restructured management team, De La Rue is confident that it has a promising future."My first few weeks at De La Rue have confirmed my view that De La Rue is a high quality business with substantial potential in growing markets," said Cobbold. "There are, of course, opportunities for improvement, building on changes already made, but shareholders should be in no doubt of my absolute commitment to realise De La Rue's full potential and deliver significant value."