FTSE 100 engineering giant Weir has submitted a binding offer and raised its offer price to buy Australian mining equipment supplier Ludowici, matching the recently-upped offer from Danish rival FLSmidth.
Back on February 10th, Weir announced that 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.
FLSmidth then raised its offer to A$10 per share a week later and entered into a scheme implementation agreement. If Weir's binding offer is accepted by the Ludowici board, Weir says that it will sign a scheme implementation agreement on the same terms as FLSmidth.
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According to Weir, FLSmidth filed a 'no increase statement' on January 23rd, an issue that Weir has raised with the Takeovers Panel and which is currently being considered.
"The Weir Implementation Agreement will give Weir the right to terminate the agreement and not proceed with the scheme of arrangement if the Takeovers Panel does not make an order preventing FLSmidth from offering, or proposing to pay, Ludowici shareholders more than A$7.20 per share," the company announced today.
The A$10-a-share offer values Ludowici at around A$357m (£243m) on a cash and debt-free basis.
According to Chief Executive Officer Keith Cochrane, "we have now undertaken due diligence which has reinforced the attractiveness of this opportunity for the Weir Group."
"The acquisition would extend Weir's offering in attractive segments of the minerals processing sector, while still meeting our strict financial criteria. Weir's binding offer also ensures certainty for Ludowici shareholders. If our offer is accepted, Ludowici shareholders will have the opportunity of receiving A$10.00 per share regardless of the outcome of the Takeover Panel proceedings," he said.
Weir was trading 0.97% higher at 2,175p before the close on Thursday.
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