- Boral (BLD) has urged its shareholders to dismiss an off-market takeover bid from Seven Group (SVW) that was lodged late yesterday
- Seven offered to purchase all BLD shares it does not already own for $6.50 each, valuing the building materials supplier at roughly $8 billion
- Boral said it has formed a committee of directors — excluding Seven CEO Ryan Stokes — to consider the proposal, which it claims undervalues the company
- Seven currently holds a 23.18-per-cent stake in Boral and is legally unable to buy any more on-market until October
- Shares in Boral finished trading yesterday at $6.50 each
Boral (BLD) has urged its shareholders to dismiss an off-market takeover bid from Seven Group (SVW) that was lodged late yesterday.
Under a proposal Boral’s board called “opportunistic,” Seven offered to purchase all of the shares it does not already own for $6.50 each, valuing the building materials supplier at roughly $8 billion.
Seven, which invests in a range of mining energy and media businesses, said it would be happy if the offer resulted in a 30-per-cent stake, but that it had to make a bid for all of Boral’s shares due to securities regulations known as “creep provisions.”
Boral said it has formed a committee of directors — excluding Seven CEO Ryan Stokes — to consider the proposal, which it claims undervalues the company since the offer price reflects no premium to Boral’s closing share price on Monday.
“Boral management remain committed to the company’s strategic goals including the transformation targets set across the Group and the ongoing process in relation to its North American portfolio,” the company said in a statement this morning.
Over the last 14 months, Seven has been steadily increasing its stake in Boral, starting with a 10 per cent holding that was accumulated between March and June last year.
It continued buying, and by September had a 20-per-cent interest, which was bumped to its current 23.18 per cent stake in April this year. Seven is legally unable to buy any more shares on-market until October.
Boral’s share price has surged more than 30 per cent this year — and almost 135 per cent over the last 12 months — as monetary and fiscal stimulus measures gave a boost to Australia’s property market. House prices are now hitting record highs, largely due to significant demand from owner-occupiers and first-home buyers.
Shares in Boral finished trading yesterday at $6.50 each.