The international security services group said early yesterday that it would not be moving ahead with previously announced plans to acquire the ISS group.
Opposition from shareholders had been growing steadily, with concerns being expressed about the scale of the deal and whether it would sit comfortably with existing G4S business strategy.
G4S Chairman Alf Duch-Pedersen explained: “We believe that developing our business towards an enhanced security and integrated facilities services model is the way forward in the longer term and we saw ISS as an excellent opportunity to achieve this aim. However, following the announcement of the acquisition, shareholders have raised concerns particularly over its scale and perceived complexity against the backdrop of current macro-economic uncertainty.
“We consulted our leading shareholders ahead of announcing the transaction, and based on the feedback received, felt confident to launch the deal. We have now discussed the merits of this combination with a significantly larger number of our shareholders and whilst they continue to express their overwhelming support for the standalone G4S business and its management, the Board has listened carefully to concerns raised by shareholders regarding the acquisition and has concluded that in the circumstances it is inappropriate to proceed.”
Chief Executive Nick Buckles added: “We are obviously disappointed that we have not been able to complete this transaction We felt strongly that the combination of G4S and ISS would create a market-leading integrated security and facilities services company which would be well placed to meet the growing needs of customers and deliver significant investment returns at the same time.
“However, we respect the importance of shareholders’ views and, on the basis of feedback received since the transaction was announced, we have decided not to proceed.
“Our strategy will continue to focus on providing higher value, integrated security solutions to our customers and leveraging our expertise in key sectors, geographies and service lines We will continue to acquire businesses which add capability to G4S to help drive the business forward.”