SPOTLESS SHARES HOLD FIRM IN FACE OF ACCELERATED TAKEOVER BID BY DOWNER EDI

ENGINEERING and maintenance firm Downer EDI (ASX: DOW) has waived all remaining outstanding defeating conditions to its takeover offer of facilities service provider Spotless Group (ASX: SPO).

The takeover offer of Spotless is now unconditional, despite not having reached the 50 per cent acceptance hurdle announced last week, and it also introduced accelerated payment terms in a move to boost its stake in Spotless which was 36.44 per cent at the end of last week.

The offer price of $1.15 per Spotless share is final according to an ASX release issued by Downer this morning.

Spotless shares are up 0.88 per cent at 12pm AEST to $1.15, equal to that being offered off-market by Downer, which means the market is expecting the takeover to go ahead.

The accelerated offer is due to close on Thursday 29 June, and Downer is encouraging shareholders to accept the deal without delay, and made references to what it describes as "mismanagement" by Spotless prior to the takeover bid.

"The alternative for Spotless shareholders is to put their faith in a company which experienced a share price decline of almost 70 per cent in the two years prior to the announcement of the offer," Downer EDI says in its ASX statement.

Prior to today's announcement, Spotless has been adamant that shareholders should remain with Spotless and not sell to Downer.

Spotless chairman Garry Hounsell said last week that shareholders would be better off if they kept their shares as the company resets its strategy.

"The board and management team have maintained their strong focus on delivering results, as we continue to maintain our belief that Spotless can create more value over the medium term as an independent company," says Hounsell.

Spotless is in the middle of a major change in strategy while the takeover is ramping up, having sold a group of short-term New Zealand contracts and extending the maturity on $300 million of debt.

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