Contractor bumps up offer by £30m in attempt to win over Mouchel shareholders
Costain has increased its takeover for troubled consultant Mouchel to around £150m after being rebuffed at the beginning of December.
In a statement to the City this morning it made an all-share offer to Mouchel valueing its shares at 135p each.
On December 2 Costain offered 105.8p per share, around £119m for the whole company, but wahttp://be-cms.mfuk.com/CMS/storyEdit.aspx#s rejected by the Mouchel board who said the offer “significantly undervalued” the company.
Mouchel’s share price dived at the beginning of December after it announced it was looking to dispose of parts of its business.
Analysts believe that other bidders could emerge with Mouchel’s share price so low, with names in the frame including Carillion, CH2M Hill and Capita.
Costain also issued a pre-close management statement saying that its order book has shrunk to £2.4bn from £2.6bn at the same time period a year ago.
It said it had secured around £800m of work for 2011 and had a “strong cash position in excess of £100 million and no significant borrowings”.
Chief executive Andrew Wylie said: “While economic conditions are expected to remain challenging, we continue to benefit from our strategy of focusing on major customers in chosen sectors whose major spending plans are underpinned by strategic national needs, regulatory commitments or essential maintenance requirements, as evidenced by the strength of our order book and the type of contracts that we are winning.”