Weir has proposed to buy Australia-listed mining equipment manufacturer Ludowici for A$294m (£200m), stepping on the shoes of Danish peer FLSmidth which made an indicative proposal for the firm last month.
The FTSE 100 engineering solutions provider says it would pay A$7.92 per Ludowici share, representing a 10% premium to FLSmidth's indicative proposal of A$7.20 a share, announced on January 23rd.
Nevertheless, Weir's "indicative proposal is subject to the satisfactory completion of due diligence and may or may not lead to an offer," the group said.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Brisbane-based Ludowici provides vibrating screens, centrifuges and complementary wear resistant products and services to the mining industry with a focus on coal applications.
"Ludowici is a well known and respected brand in the coal processing sector," said Weir's Chief Executive Keith Cochrane.
"The potential acquisition would extend Weir's offering in minerals processing and expand our exposure to the attractive and fast growing coal sector where Weir is relatively unrepresented. As a part of the global Weir Minerals business, we would look to accelerate the growth of Ludowici, consistent with Weir's 2010 acquisition of Linatex."
Weir's shares fell 1.85% to 1,960p in early trading on Friday.
BC
-
8 of the best houses for sale with annexesThe best houses with annexes – from a period property in the Lake District to a 13th-century house with a two-bedroom annexe in Saltwood, Kent
-
Zelenskyy moves to appease Donald Trump – what happens now?Ukraine’s president Volodymyr Zelenskyy is conceding ground to secure the least-worst deal possible, says Emily Hohler
