Brisbane-based laboratory services and chemicals group, Campbell Brothers, is back on the takeover trail in its preferred area, analytics.
Yesterday it revealed a $123 million bid for minerals tester, Ammtec Ltd.
It is the most expensive offer of the three made in the past 8 months by Campbell.
Campbell Brothers has previously acquired testing companies, PearlStreet for just over $56 million and Ecowise for $40 million cash and $11 million of debt, and integrated them into ALS.
Through its subsidiary, Australian Laboratory Services, Campbell is now offering $3.35 cash for each Ammtec share, a 33% premium to Ammtec’s last traded share price of $2.51.
Ammtec shares closed up 27.5% at $3.20, a rise of 69c on the day.
There is also a share alternative for Ammtec shareholders who want to accept the Offer and receive Campbell Brothers shares (rather than cash) as consideration.
"The actual number of Campbell Brothers shares which they will receive if they accept the Offer (and it becomes unconditional) will be 2 Campbell Brothers shares for every 17 Ammtec shares held," Campbell said in its statement yesterday.
"The board of Ammtec is considering its response to the announcement, and, pending further advice from the board, Ammtec’s shareholders are advised to take no action in relation to Campbell Brothers bid or any document received from Campbell Brothers until they receive the Directors formal recommendation."
Ammtec’s main operations involve supplying metallurgical and mineral testing services to the mining industry.
Campbell said that ALS "is a global leader in the provision of analytical laboratory and technical services to international environmental, minerals, coal, tribology (used oil), food, and industrial markets.
"It is one of the largest and most successful laboratory groups in the world, operating more than 160 laboratories in 42 countries and offering a broad range of inspection and analytical testing services."
Perth-based Ammtec is a leading metallurgical and mineral testing consultancy, having served the local and international mining industries since 1979.
It is one of only a few comprehensive metallurgical testing firms globally, and currently operates laboratories in Western Australia, New South Wales, South Australia and Tasmania.
"Campbell Brothers’ Offer will provide Ammtec shareholders with the opportunity to realise a substantial premium for their shares,"
"Campbell Brothers’ believes the cash offer will be attractive to Ammtec shareholders given the relatively illiquid market for Ammtec shares.
"The option to receive Campbell Brothers shares in lieu of cash will be attractive to Ammtec shareholders who wish to participate in the benefits from the acquisition, from the larger and more liquid market for Campbell Brothers shares, and from the benefits that come with a more diversified portfolio of geographic and end market exposures.
"There may also be potential capital gains tax rollover relief available to Ammtec shareholders accepting Campbell Brothers shares as their preferred form of consideration."
Campbell shares were hit by yesterday’s weakness in the broader market.
The shares fell sharply, more than $1.30, or over 6%, in the wake of the announcement, but recovered somewhat to be down 2%, or 60c, at $28.40.
