Watchstone rejects final offer from Polygon

Watchstone Group said on Wednesday that a final takeover offer of 38p a share made by Polygon a day earlier still undervalues the group.

On Tuesday, Polygon lifted its offer by just under 12% from 34p a share, valuing Watchstone at around £17.5m.

But Watchstone has said it continues to recommend that shareholders do not accept the final offer.

"The directors, who have been so advised by SPARK as to the financial terms of the final offer, consider that the final offer undervalues Watchstone and its prospects, on the basis of which they unanimously recommend that shareholders reject the final offer," it said.

Polygon, which already owns a stake of just under a third in Watchstone, made an unsoliciated offer for the company on 1 July. Watchstone said later that month that the offer - which valued the group at around £15.7m and was at a 16% discount to the undisturbed closing share price - was "opportunistic".

"The offer value is below the values of the company's cash and the net assets as at 31 December 2020, and does not recognise any value for the contingent litigation assets," it said at the time.