Valpak’s new owners have said they will seek to develop new services for the UK and European markets after completing their controversial buy-out of the compliance giant.
Some 91% of voting members of the mutual approved the package put together by the firm’s existing management and recommended by its senior independent director Gerry Orbell.
The firm will now trade as a limited liability company.
Orbell said “I am extremely pleased that members have voted in favour of proposal; it is both a testament of their commitment to Valpak as a gold-standard service provider and of their confidence in the current management team.
“Throughout this process the feedback from members has been overwhelmingly positive, it has never been about the money but about the best people who can continue to provide the best value-adding services.
“I am delighted with the result which I believe will see an enhancement of Valpak’s current offering and, in the long term, a platform for the development of new compliance services and products in UK and into the continental European and global market. ”
The firm’s existing management will buy 70% of the firm from its 4,001 members, the current legal owners, with German compliance scheme owner Greenpoint snapping up the rest.
The business will remain focused on UK compliance, and Greenpoint has made £2m capital available for investment in the future development of services and products both in the UK and internationally.
Members will secure £340 each, a total of £1.4m, as an initial consideration, with a further £270 deferred consideration, some £1.125m in all, if the packaging regulations continue in 2013.
The price, which the management has always maintained is “fair and reasonable”, has come under considerable criticism from both rivals and former senior figures of the company.
Wastecare managing director Peter Hunt complained his bid, which he said was worth “many times more” than what directors offered, was not put to the members and accused the incumbent management of buying the company “on the cheap”.
Hunt said: “In my opinion [the offer by Valpak directors] is a ludicrously low offer for a business which has £8m of cash at hand and is highly profitable.
“Lord Deben [Valpak chairman] first tried to buy Valpak last August but his incredibly low offer was blocked. Seven companies including mine submitted bids but Gerry Orbell, the non-executive director managing the sale process, rejected them all out of hand despite admitting that there was more money on the table.”
Hunt’s comments followed former Valpak chief executive John Turner, who led the company in the late 1990s, saying the deal appeared to offer more for the firm’s management than members, which currently own the scheme.
Turner told MRW he was “deeply disappointed” the current management had sought to change the Valpak model and members needed to question whether a £610 payment was sufficient benefit.
“Looking from the outside it would appear the only people that seem to benefit from this move are the directors, who are proposing to buy the company,” he said.
“Changing the business model for what was a successful, not-for-profit organisation owned by its members needs to be seriously questioned and one assumes the members are doing so.”