Murray & Roberts shares get takeover talk boost

South African engineering and construction group Murray & Roberts’ (M&R) share price received a major boost yesterday morning, when news broke that a German billionaire family has plans to take over the company which operated the Gauteng’s popular Gautrain.

M&R minority shareholder, German investment holding company ATON GMBH, is offering shareholders R15 per share in an effort to increase its 29.9% stake to 100%.

That is significantly higher than the company’s closing share price on Friday of R9.64.

ATON has already obtained support for the move from fund manager Allan Gray.

M&R announced before market opening yesterday that ATON notified it on Friday, that it intended to make a firm offer to all other M&R shareholders to acquire the balance of shares not currently owned by ATON at a cash offer of R15 per ordinary share.

M&R first announced in February 2017 that ATON had acquired a substantial minority interest in the group. It bought the shares on the market without any interaction with the group.

ATON is associated with the wealthy Helmig family and has a well-diversified portfolio of investments in technology and service businesses (mining, automotive engineering and medical technology).

One of ATON’s key focus areas is in mining services, through its 100% owned Canada-based Redpath group (a global underground mining service provider and contractor).

M&R said ATON had initially acquired about 4.5% of the group between June and September 2015. It subsequently materially increased its shareholding between February and April 2017.

ATON is currently the beneficial owner of approximately 133.4 million Murray & Roberts’ ordinary shares or approximately 29.9% of Murray & Roberts’ Ordinary Share Capital.

“During the period February to April 2017, approximately 78% of traded volumes in Murray & Roberts ordinary shares was at a price range of R15 to R15.50 per Murray & Roberts’ ordinary share.

“As part of the Proposed ATON Offer, ATON has advised that it has entered into an agreement to purchase a further approximately 13.7 million Murray & Roberts’ ordinary shares (or approximately 3.1% of Murray & Roberts’ Ordinary Share Capital), which, once completed, will increase its shareholding to approximately 33.1% of Murray & Roberts Ordinary Share Capital.

“In addition, ATON has advised that it has obtained an irrevocable undertaking from Allan Gray Proprietary Limited, acting not as principal but on behalf of its clients, representing approximately 10.9% of Murray & Roberts’ Ordinary Share Capital, to accept the Proposed ATON Offer, if made.”

M&R said an independent board will review the terms proposed and will advise shareholders of its findings. The group advised shareholders to exercise caution when dealing in the shares.