The Toll Holdings spin-off, Asciano Ltd, has been sprung with a small holding in rival transport services group, Brambles.
The discovery and an exchange of letters with more details and claims saw Brambles shares jump $1.39 to $12.73 on more than 33 million shares as punters, hedge funds and other optimists hopped in to play.
Brambles is nowworth around $18 billion at yesterday's closing price.
From all appearances it looks like Brambles has managed to spot an accumulation of shares, mainly by Macquarie Bank on behalf of Asciano, the transport infrastructure spin-off from Toll Holdings.
Toll itself has a small stake of less than half a per cent but has said it doesn't plan a joint deal with its former associate. That was through its adviser in the Patrick takeover, Citigroup.
Brambles had seen its shares fall 11% since last November when it completed the sale of its waste collection and industrial services unit and delisted its shares from the London Stock Exchange.
In its statement to the ASX, Brambles said the Asciano holding was around 1.2% of Brambles' capital (since increased to 1.8%) and had been acquired since late June. At yesterday's prices, the stake was worth more than $290 million.
Brambles (BXB) told the ASX yesterday that the presence of Asciano on its register had been picked up during a 'regular analysis' of the real ownership of shares.
"In the process of undertaking such analysis, National Rail Consortium (Insurance) Pty Ltd (NRC) confirmed to Brambles last night that it holds a relevant interest in 15,967,742 Brambles ordinary shares. ASIC searches have identified that NRC is a subsidiary of Asciano Limited.
"The shares are currently registered in the name of a subsidiary of Macquarie Bank Limited, which has confirmed to Brambles that these shares were purchased pursuant to instructions issued since 29 June 2007.
"Macquarie Bank also advised Brambles that MS Corporate Services Pty Ltd (MSC), also identified by ASIC searches as a subsidiary of Asciano Limited, has a relevant interest in a further 1,600,000 Brambles ordinary shares.
"The combined holdings of NRC and MSC referred to above represent approximately 1.2% of Brambles' total issued ordinary shares. Brambles is seeking further information from Asciano Limited with respect to these relevant interests and its intentions."
And it then issued this statement in relation to Toll:
"Since the announcement earlier today regarding Asciano Group's relevant interest in Brambles' shares, Brambles has received from Citigroup Global Markets Limited a response to a tracing notice issued by Brambles, confirming that a separate holding of 5,100,000 Brambles ordinary shares, registered in Citigroup's name, belongs to Toll Holdings Limited.
"Brambles has sought to ascertain Toll Holdings' intentions with respect to Brambles. Toll Holdings has advised Brambles that it has no particular plan with respect to its Brambles shareholding but has declined to provide Brambles with any assurance as to its future intentions.
"Toll Holdings has also stated to Brambles that Asciano and Toll Holdings are not working together. Brambles will be seeking further information from Toll Holdings with respect to its relevant interest in Brambles shares."
The shares have been picked up since the end of June when circumstances in financial markets were much different. The credit crunch and doubt about higher leveraged takeovers that has emerged since mid-July would make it much tougher for Asciano and Macquarie to launch a hostile bid.
Toll cannot play because that might breach agreements with the competition regulator.
Certainly, given the pounding MBL shares have had in the past week, it would be hard-pressed to mount any significant deal at the moment. It could, but the cost to it and its client would be high.
That's especially so given the relative sizes of the two companies. BXB has a $16.2 billion or so market cap, Asciano (AIO) is valued by the market at some $6 billion at its current share price of $9.17 (up 16c). Toll is capitalised at $8.9 billion, so Brambles is bigger than both combined.
A bid at this level would be tough, but an agreed takeover of AIO by Brambles (in effect a form of reverse takeover) might have a chance of succeeding.
Brambles is generating lots of cash and has been a heavy buyer of its own shares in the past year as the company quit London, sold non-performing assets, and returned to its CHEP and Reckon document core businesses.
Asciano Group (AIO) is a transport infrastructure business, with a portfolio which includes Pacific National and Patricks. These two businesses own and operate four container terminals, bulk export facilities, stevedoring equipment and associated services, and extensive rail operations. AIO was formed by the restructuring of Toll Holdings infrastructure business from Tolls logistics assets.
AIO said yesterday that:
"Further to the announcement by Asciano Group (Asciano) this morning in relation to its investment in Brambles Limited (Brambles), Asciano would like to clarify that its presence as a shareholder was first notified to Brambles on Monday, 30 July 2007.
"Asciano's position in the transport infrastructure and logistics sectors means that it has developed a strong understanding of Brambles assets over a long period of time. The recent weakness in the Brambles share price has provided the opportunity for Asciano to make this investment.
"As a shareholder, Asciano looks forward to having discussions with Brambles on ways to create value for all Brambles shareholders.
"Asciano would also like to confirm that it is not currently working with Toll Holdings in relation to Brambles and has no intention of doing so."
As
