FLSmidth A/S (OMX: FLS) has raised its offer for all the share of Australian coal mining equipment maker Ludowici to AUD 10 per share. The offer price of 10 AUD is a 186% premium of the share price on January 18th. The price values Ludowici at around 358 million AUD (about 2.2 billion NOK) and implies an EV/EBITDA multiplier of 12.8x based on proforma EBITDA of 28 million for 2011. Ludowici manufactures vibrating screens, centrifuges and complementary wear resistant products
On January 23th FLSmidth announced it had made an agreement to acquire all shares at a price of 7.20 per share. That offer was already supported by the founding family and the management.
However couple days ago Scottish engineering firm Weir Group Plc decided to make a non-binding rival bid of 7.92 AUD. The company has a mining markets division Weir Minerals. By way of this offer, Weir gained access to Ludowici’s books and is doing its due diligence. FLSmidth’s initial offer was also subject to due diligence but the new offer no longer is.
The offer is conditional on Australian Takeovers Panel ruling. Weir has made an application to the the Panel asking FLSmidth to be restricted from increasing its offer on the basis of its January 23 offer being ”last and final”. There is no comment from the Panel on the merits of the application. Ludowici was trading at 9.80 AUD today. The aggressive strategy of Weir makes it hard to rule out another bid. FLSmidth is down 2% in red Thursday trading.
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