CIMIC offloads Macmahon shares after failed takeover attempt

Major contractor CIMIC Group has sold its stake in Macmahon Holdings, six months after it launched a takeover attempt for the smaller services company.

CIMIC sold its 23.64 per cent interest in ASX-listed Macmahon for $46.85 million.

According to Spanish-controlled CIMIC, the transaction will generate a profit for the company and was achieved at a 65 per cent premium to Macmahon’s three-month volume weighted average price (VWAP) on January 23 2017, the day prior to it unveiling the takeover bid.

CIMIC’s offer for Macmahon valued the Perth-based company at around $175 million. Macmahon swiftly rejected the offer, labelling it as “inadequate” and “opportunistic”, while advising its shareholders to reject the bid.

The stand-off between the two companies finished up at the Takeovers Panel after Macmahon tried to block CIMIC’s plans through a deal with Indonesia’s PT Amman Mineral Nusa Tenggara (AMNT).

After the Takeovers Panel chose not to investigate Macmahon’s Indonesian deal CIMIC has decided to retreat from the takeover offer.

Macmahon shareholders are set to vote on the Indonesia deal next week. The agreement with AMNT involves Macmahon acquiring assets from the Indonesian miner, which in return would become a major shareholder in the Australian contractor.

If approved, Macmahon would acquire equipment with an estimated value of about $US150 million ($197.6 million) from the AMNT-operated Batu Hijau copper-gold mine. For the assets, Macmahon would issue AMNT with new shares equal to around 44 per cent of its expanded share base.