Intellectual property firm IPH Limited has lobbed a $197 milllion hostile takeover bid for Xenith IP, its latest attempt to disrupt the merger of its two smaller ASX-listed rivals.
IPH said on Tuesday that its cash-and-scrip offer for Xenith was worth 23.3 per cent more to Xenith shareholders than its proposed merger of equals with QANTM Intellectual Property.
"We believe our proposal to Xenith proves a great opportunity to bring together two high quality IP businesses," IPH managing director Andrew Blattman said.
Xenith said it was reviewing the proposal in conjunction with its advisors.
The offer comes three weeks before shareholders Xenith are scheduled to vote on the QANTM merger, which would create an intellectual property firm rivalling IPH in employees and revenue.
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IPH is offering the equivalent of $1.97 a share for the 80 per cent of Xenith that it does not already own, a 22.7 per cent premium to Xenith's share price on Monday.
The ASX200-component IPH already in November made a non-binding offer of $1.75 a share for QANTM, which the QANTM board rejected in favour of the Xenith merger.
Then last month IPH acquired 20 per cent of Xenith shares for $32.7 million and said it would vote against the merger.
"It is hard to avoid the conclusion that IPH is acting in its own interests to protect itself from increased competition," Xenith chairwoman Sibylle Krieger said last week.
At 1505 AEDT, Xenith shares were up 13.71 per cent, at $1.825; QANTM shares were down 9.64 per cent, at $1.50, and IPH shares were up 3.22 per cent, at $6.75.
The three companies are the only ASX-listed intellectual property firms and have been shaking up the traditionally staid industry.
IPH was the first to list, a holding company created when Spruson & Ferguson went public in late 2014.
It has since made seven acquisitions, including some of Australia and New Zealand's oldest intellectual property firms.
IPH employs 630 people in the Asia-Pacific and had $124.9 million in revenue in the six months to December 31, more than that of its two ASX rivals put together.
IP firm Shelston - founded in 1859 - followed Spruson & Ferguson's lead in late 2015, listing as Xenith Group and has since acquired patent and trademark firms Griffith Hack and Watermark.
Davies Collison Cave, founded in 1877 as Collison & Co. in Adelaide, listed in 2016 as QANTM and has since bought a Malaysian IP firm.
Ms Krieger said in February that there was a "distinct difference in the business model and the culture of IPH on the one hand and Xenith and QANTM on the other hand".
But IPH said in its takeover proposal that each of its component businesses has its own culture.
