Seven has upped its unconditional offer for Boral shares to $7.30 and its conditional offer to $7.40.
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At the time of writing, shares in the construction materials company are trading for $7.37 – up 0.27%. The S&P/ASX 200 Index (ASX: XJO) is 0.56% lower at 7,272 points.
Let’s look at what’s going on.
Seven’s improved offer
In a statement to the ASX, Seven revealed it would increase its unconditional bid for Boral shares from $6.50 to $7.30 after the requisite number of shareholders had accepted the offer.
Seven said previously it would raise its offer for shares if enough shareholders sell to give it increased ownership to 29.5%. It has also said it will pay $7.40 per Boral share if its interest in the company rises to 34.5%. Before the takeover bid, Seven owned 24.5% of Boral.
The move prompted Boral’s board to again urge investors to reject the offer. In its advice, the board said Seven’s bid was “opportunistic” and did not represent fair value. The board believes its shares are worth somewhere between $8.25 and $9.13.
The current Boral share price is above Seven’s unconditional offer of $7.30 but below its conditional offer of $7.40. This might suggest the market believes more shareholders are willing to sell to Seven.
Seven has also extended its offer for the conditional purchase. Instead of expiring tomorrow, as first announced, the period to accept will end on 15 July.
Boral share price snapshot
Over the past 12 months, the Boral share price has increased 88.24%. Only yesterday, the company hit another new 52-week high of $7.40. It annual high has been continually re-setting over the past few days, driven mostly by Seven’s takeover bid.
Shares in the company are significantly higher now than they were before the COVID market crash.
Boral has a market capitalisation of $8.7 billion.
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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.