The 940-pence offer topped CVC’s 915-pence proposal, revealing how two buyers valued the same industrial asset.
Bodycote's board has unanimously recommended a £1.65 billion cash acquisition by Vulcan Alpha Bidco, an acquisition vehicle owned by funds managed by Veritas Capital, at 940 pence per share. The offer comprises 932.8 pence in cash plus a 7.2 pence permitted interim dividend, and represents a 37.5% premium to Bodycote's three month volume weighted average price through and a 42.5% premium to the 12-month average.
The price emerged from a competitive process. CVC Capital Partners had separately submitted a rival proposal of 915 pence per share including a permitted dividend. Veritas's improved offer is the only proposal the board is recommending.
Bodycote provides heat treatment and surface coating services for metal components to aerospace and other industrial customers. The deal is structured as a UK scheme of arrangement, requiring 75% shareholder approval by value and by votes cast at two separate meetings, plus court sanction and regulatory clearances, and is expected to close in the first quarter of 2027.
A narrow valuation gap
The useful data point here is not the headline price alone but the gap between it and what CVC was willing to pay. A 25 pence per share difference between two well-capitalized sponsors bidding for the same asset is an unusually precise window into how two independent buyers valued the same cash flows, at a moment when broader private equity exit conditions have been mixed.
Whether that willingness to pay up extends beyond Bodycote is a separate question. Bodycote's aerospace-adjacent, defensively positioned franchise may be an easier asset to compete for than a typical UK industrial company, meaning the premium reflects asset specific dynamics between two bidders as much as any broader repricing of UK industrials.
Whether CVC retains any path to re engage before the scheme receives court sanction remains an open question. CVC has not said publicly whether it is still evaluating its options.