Macquarie Raises Offer for Techem to $2 Billion

Australian bank Macquarie has raised its cash offer for German metering company Techem to 1.43 billion euros ($2 billion), 5.4 percent more than its previous bid.

Techem shares soared 17.3 percent to just below the 58 euros a share that Macquarie offered in its fourth bid for Techem within a year. Techem advised shareholders to accept the offer, as it had done with the previous two bids.

"We see it very likely that the bid will go through and expect an immediate convergence towards the bidding price," Sal Oppenheim analyst Matthias Heck said in a note.

Macquarie manages about A$200 billion ($175.9 billion) globally and has been buying infrastructure assets such as water companies in Britain and warehouses in Germany as decade-long investments for its pension funds.

The bank, Australia's largest investment bank, acquires toll roads, airports, power and water utilities and bundles them into listed and unlisted funds and charges fees for managing them.

Techem had been caught in a struggle between Macquarie, hedge funds and other investors that sought to buy the company.

Chief Executive Horst Enzelmueller said in a newspaper interview in September he was looking for a new majority investor to end the stalemate caused by the two competing large shareholders -- Macquarie and hedge funds.

"The offer is amongst all possible options the best for the future," spokesman Stefan Lutz said. Macquarie plans to own the company for at least 10 years, it said.

Techem's Major Investors

Techem's Website showed major investors as of Oct. 2 included hedge funds Elliott Capital and The Liverpool Limited Partnership (15.2 percent), Sandell (5.1 percent) and Boussard & Gavaudan (3.0 percent).

Bank UBS held 8.9 percent and Credit Suisse 2.1 percent.

Techem Chief Financial Officer Peter Wunderlich left the group this month because of differences over Techem's strategy.

Techem shares were up 17.3 percent at 57.70 euros.

Macquarie's initial bid of 44 euros a share for the German company in October 2006 was topped by a 52 euro-a-share bid from BC Partners, leading Macquarie to increase its bid to 55 euros.

It agreed to share control of the metering company with BC Partners but nonetheless had to admit defeat in February, when it failed to reach the minimum 70.5 percent acceptance rate it had set.

This time it lowered the number of shareholders which have to accept its offer to 50 percent plus one share. The Australian bank now holds between 25 percent and 30 percent of Techem.

Before Monday's leap Techem shares had risen 18 percent in the past 12 months, less than the MDAX index of medium-sized companies traded in Frankfurt, which had increased 21 percent in that period.

The company, founded in 1952, reads meters and helps companies manage their energy supply. It generated earnings before interest and taxes of 106.4 million euros in its fiscal year to end-September 2006 on sales of 523 million euros.