01.07.2010

Boom dismisses takeover ‘bid’

Australian crane and access company Boom Logistics has dismissed the 52 cents a share takeover bid from McAleese/Harbew as a “non bid”.

This in spite of the fact that the supposed offer was at a 73 percent premium on Boom’s share price at the time the offer was disclosed.

Boom management said "The ‘bid is a highly conditional, confidential and incomplete proposal and that the board considered that the offer price was so far below value it didn't warrant engagement.”

The company says that it has experienced a sharp increase in activity levels during the last quarter of its financial year and expects this to continue into the new year with a strong pipeline of growth opportunities. Although it has so far refrained from putting any numbers or guidance to this.

While the company is dismissive of the latest offer it says that it is willing to explore any change of control or other value-enhancing proposal that represents full and fair value for the shareholders that offers sufficient clarity and certainty.

The latest declarations from Boom put the ball back firmly with the bidder which is supported by the private equity firm Archer.

Vertikal Comment

This is just the latest skirmish in a game that has been running over the past nine months or so. While the potential acquirers have been far from clear and open - possibly even devious, Boom management has appeared at times to have taken an arrogant and dismissive attitude towards the offers.

So far though most of its shareholders do not appear to be unhappy and seem to be content to sit and watch the process develop. Many have been pleased to see the resulting boost in the stock price, which had languished as low as 20 cents.

If the Archer/Harbew/McAleese consortium is serious, it needs to formalise its offer now as the market in Australia is certainly turning up. And given that a good number of investors bought in low they may well prefer ‘jam today’…rather than a promise of it tomorrow so a proper bid may well succeed.