Consultant says £150m Costain bid ’significantly undervalues the business’

Mouchel have rejected a second offer by Costain made this morning which valued the company at around £150m.

Costain upped their offer from a previous bid of £119m made at the beginning of December, but Mouchel’s board announced this afternoon that it rejected the increased proposal.

In a statement to the City, the consultant said: “The board of Mouchel confirms that, following consultation with its advisers, it has rejected Costain’s indicative conditional proposal on the basis that it significantly undervalues the business.”

The bid had valued each Mouchel share at 135p.

In a statement, Costain said it was “surprised” by Mouchel’s rejection of its offer.

“This decision by the Board of Mouchel denies its shareholders the opportunity to have a major stake in a well capitalised, financially efficient, enlarged business, with a clear strategy for future profitable growth,” it stated.