Shares of Ryder System Inc. (NYSE:R +17.1%) roared higher on Friday as a 13-D filing reflected a takeover bid for the company.
The filing notes the proposed purchase price at $86 per share made by HG Vora Capital Management, a major shareholder of the company. The proposed bid represents a 24.8% premium to the 30-day trailing volume weighted average price of the stock, per the filing. The premium implies a purchase price of about $4.4 billion. HG Vora anticipates funding the cash deal solely with capital provided by funds managed. Prior to the bid for the company on Friday, the New York-based asset manager held 5.05 million Ryder (R) shares representing a 9.9% stake in the company. The filing also notes “cash-settled swap agreements with unaffiliated third-party financial institutions that reference 450,000 shares of common stock." "Together with our financing partners, we are prepared to devote the resources necessary to consummate the transaction and...are highly confident we can complete our due diligence within 60 days," HG Vora CEO Parag Vora wrote. Shares jumped over 17% shortly after the document was filed, approaching the proposed takeover price.
"We were surprised to see the offer and do not currently expect a competing offers from a strategic buyer," Stifel said in a flash reaction to the news.
Ryder confirmed receipt of the offer on Friday afternoon, indicating that Morgan Stanley is being retained as a financial advisor while Wachtell, Lipton, Rosen & Katz will act as a legal advisor as the board reviews the unsolicited bid.