Shares in Australian company Broadspectrum have soared after Spanish construction giant Ferrovial
Sydney - AFP
Shares in Australian company Broadspectrum soared on Monday after Spanish construction giant Ferrovial returned for a second tilt at the services provider, a year after an initial bid was knocked back.
Madrid-listed Ferrovial had offered Aus$2.0 a share in October last year, valuing Broadspectrum, then known as Transfield Services, at around Aus$1.0 billion (US$733 million), but it was rejected as poor value.
Since then Broadspectrum shares have slumped and Ferrovial, which specialises in infrastructure and construction with a presence in more than 25 countries, returned with a new all-cash Aus$1.35 a share offer.
This was a 59 percent premium to Broadspectrum's closing price on Friday, with the stock flying more than 50 percent higher to Aus$1.31 on Monday.
The Spanish multinational's chief executive Inigo Meiras said in the bidder's statement that, "Ferrovial is making a long-term decision to seek to establish a presence in the Australian market".
"The offer price is compelling value for Broadspectrum shareholders."
Broadspectrum, which has battled falling earnings in its resources and industrial business and uncertainty over a contract to maintain offshore detention centres for the Australian government, recommended shareholders "take no action".
"The board of Broadspectrum will consider the offer and advise shareholders of its views shortly," added the firm, which provides electrical, commissioning, and mechanical services to the resources, industrial and construction sectors.