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Scottish Pacific acquisition of CML progresses

by Annie Kane8 minute read
Scottish Pacific acquisition of CML progresses

The acquisition of debtor finance specialist CML Group by Scottish Pacific has progressed further after the main competitor to the deal withdrew its offer.

ASX-listed CML Group – the parent company of Cashflow Finance – looks set to progress with a scheme of arrangement with Scottish Pacific Group Ltd (Scottish Pacific), in a deal which would see Scottish Pacific acquire 100 per cent of the issued share capital of CML for a total cash consideration of $0.60 per share (comprising $0.57 cash per share and permitting a fully franked dividend of $0.03 per share).

The bid, which was put forward as a non-binding indicative and conditional offer last year, was issued in competition with an earlier merger offer by Australia’s largest equipment finance broking company, Consolidated Operations Group (COG).

However, CML announced last month that it was to terminate the agreement with COG after suggesting that they had “materially breached” the agreement by acquiring a relevant interest in 17.36 per cent of the issued voting shares in CML Group.


COG has now confirmed that it “no longer seeks to acquire CML”, particularly given the “significant adverse changes to market conditions as a result of COVID-19”. It has therefore said its interests would be best served if the Scottish Pacific scheme goes ahead “so that COG would receive cash for its 17.4 per cent interest in CML”.

On this basis, it advised that it was now supportive of the Scottish Pacific offer and would vote in favour of the scheme (in the absence of a superior proposal).

CML Group has therefore agreed to release COG from its previous merger agreement.

Subject to court and regulatory approval, it is anticipated that CML shareholders will be given the opportunity to vote on the Scottish Pacific deal in May 2020.

[Related: Scottish Pacific looks to buy CML Group]

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