Who’s going to make a cheeky bid for Dawn? Tod or Bidvest?



Who’s going to make a cheeky bid for Dawn? Tod or Bidvest?

Gossip that former Dawn CEO Derek Tod might pitch an offer for the bombed-out building materials supplier

Marc Hasenfuss

The bombed-out share price of building materials supplier Distribution and Warehousing Network (Dawn) has almost doubled since it issued an unspecific cautionary notice to shareholders on November 13.
Dawn has been one of the worst performers on the JSE in 2018, losing about 90% of its value so far. The share price – which touched an all-time low of 3c – is pricing in disaster.
So the bounce in the share price to 9c, which still hugely discounts the last stated tangible net asset value of 53c a share (end-March), suggests the market is betting on some uplifting news.
The most obvious scenario (if the tangible net asset value can be considered robust) would see a pitching of a cheeky buyout offer at a decent premium to the average share price seen in the last few weeks.
There has been talk that the new management team at Dawn might be keen to buy out the business, while Bidvest has also been cited as a possible suitor.
The latest gossip doing the rounds is that former Dawn CEO Derek Tod is also looking to pitch an opportunistic offer for the group. The emergence of Tod (which is still conjecture at this point) would probably anger shareholders who blame the former CEO for the group’s predicament.
Still, any bidder – especially one so familiar with the business – would be good for despondent Dawn shareholders. Who knows, maybe the sight of a cheeky offer will even coax other parties with better offers to have a closer look at Dawn.
It might be far-fetched to suggest a bidding war will ensue, but at least shareholders might have an opportunity to see Dawn’s value proposition properly tested.

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