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Hedge fund Manikay Partners has increased its shareholding in business management business MYOB (ASX: MYO) a day after it publicised its criticism of a potential takeover of MYOB.
Manikay now holds 11 per cent of MYOB shares, up from 9.99 per cent.
The increase in shareholding comes after the hedge fund sent a letter to MYOB expressing its refusal to back a $2.2 billion takeover offer from Kohlberg Kravis Roberts & Co (KKR).
MYOB opened its books to KKR back in November 2018 ahead of the proposed $2.2 billion takeover. The private equity firm, which already owns a 20 per cent stake in MYOB, announced its takeover proposal in early October 2018.
Manikay said yesterday that the MYOB board should reconsider its recommendation of the proposal to shareholders.
"We believe this deal significant undervalues the company," said Manikay.
"We strongly believe that, given the change in market conditions since the scheme was agreed, among other things, the board's recommendation to vote in favour of the scheme cannot be supported and should not be maintained."
Responding to Manikay's letter the MYOB board said that it continues to unanimously recommend KKR's proposal.
MYOB shareholders will be given an opportunity to vote on the proposal on 17 April 2019.
Shares in MYOB are down 0.15 per cent to $3.38 per share at 3.24pm AEDT.
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