Morgan Advanced Materials, formerly Morgan Crucible, has rejected an all-share takeover proposal from engineering group Vesuvius that it said would have exposed its shareholders to the lower margin iron and steel sector.
Shares of Morgan, which makes insulation products used in medical instruments and fire protection systems, rose 2.95 per cent to 300.4p yesterday to rank among the top risers in the FTSE 250.
“We are disappointed that the opportunity to explore the creation of significant incremental value for both sets of shareholders has been rejected,” said Vesuvius chairman John McDonough. “We will continue to evaluate compelling opportunities to strengthen the group, while continuing to exercise firm capital discipline.”
Morgan said its board had decided unanimously to reject the proposal, because it “fundamentally undervalued” the firm. Vesuvius said it did not intend to bid again.