Key Rinker Shareholder Says to Accept Cemex Offer
Australian institutional investor Perpetual said on Monday it planned to accept a US$14 billion (A$17.1 billion) takeover offer for Australian building materials maker Rinker Group after
Mexico's Cemex eased the conditions for its bid.
Perpetual, which holds around 10.5% of Rinker shares -- enough to block the offer before the conditions were changed -- said on Monday it planned to accept the amended offer "as soon as practicable."
Cemex , the world's No. 3 cement maker, extended its bid for a fifth time to June 8 and said it would waive a 90% acceptance condition if it held more than 50% of the Australian building materials maker by that date.
In addition, shareholders could keep Rinker's final A$0.25 cents a share dividend, irrespective of when they accepted Cemex's offer, it said in a stock exchange filing on Monday.
The announcement follows meetings last week between Cemex executives and Rinker's leading Australian institutional shareholders.
Last Friday, Cemex said it held 1.66% of Rinker shares.
Buying Rinker will beef up Cemex's presence in the United States, which accounts for 80% of the Australian company's revenue, and give it a foothold in China.
Rinker rejected Cemex's original bid of $13 a share last year, but the Australian firm has been hurt by continued poor conditions in the U.S., where it has about 80% of its operations, and last month it recommended shareholders accept a sweetened offer of $15.85 a share.
Rinker also posted a fall in quarterly earnings in April, warning tough conditions in the U.S. housing market would keep profits steady or push them lower in fiscal 2008.
Shares in Rinker jumped almost 2% in early Monday trade to be at A$19.24 in the morning session, still below the bid price of about A$19.34 a share, based on the Cemex U.S. dollar-based bid of $15.85 a share at current exchange rates.
The Cemex announcement comes as takeover bids for a number of Australian companies encounter stiff shareholder resistance.
Last week an A$11 billion buyout bid for Australia's Qantas Airways collapsed after it failed to win sufficient shareholder support.