APM Human Services International received on Monday an A$910.4 million ($598.59 million) buyout offer from U.S. private equity firm Madison Dearborn Partners, and said it expects lower earnings this year, sending its shares down 30%.

Madison Dearborn, which already owns more than a 29% stake in the company, offered to acquire the rest for A$1.40 per share, a 14.1% discount to APM’s last closing price on March 26, and lower than previous suitor CVC Asia Pacific’s final offer of A$2 apiece.

The development comes after private equity firm CVC Asia Pacific failed to finalize its A$1.83 billion takeover offer for APM at the end of a four-week exclusivity period.

CVC had sweetened its proposal to A$2 per share after APM rejected the private equity firm’s initial A$1.60 apiece offer, citing that the bid did not “sufficiently reflect its fundamental value”.

APM said the offer price under Madison Dearborn’s offer was “disappointing”, adding it intends to engage with Madison Dearborn and any other interested parties to determine if a proposal can be put to shareholders.

The company said it expects underlying net profit after tax and amortisation for fiscal 2024 between A$95 million and A$105 million, lower than A$178.2 million posted last year.

“Our Employment Services business is operating in an environment of extended low levels of unemployment, reducing client flows and requiring increased support to achieve sustainable employment,” APM said.

Shares of APM were down as much as 30.1%, as of 0053 GMT, on resumed trade. Shares were suspended from trading on March 27.

The firm said it expects incremental earnings growth in fiscal 2025 through contract awards and corporate initiatives.

($1=1.5209 Australian dollars)

Reuters