Under the latest indicative offer, Ashtead would put up 47.5 per cent of the cash price to acquire Lavendon’s UK operations, with Belgium-based TVH taking the European and Middle Eastern parts of the business.
Lavendon said yesterday the 115p per share plan “is opportunistic and significantly undervalues the company” and its board unanimously rejected the interest.
TVH said it was interested in making a £170m offer in November, which Lavendon also rejected as undervaluing the firm.
Lavendon shares jumped from 79p to 103p at the time and have continued to rise, suggesting investors expect a higher bid. However, shares in Lavendon closed 3.5 per cent down at 111.25p yesterday, giving it a market cap of £187.7m.
Ashtead shares lost 2.2 per cent to close at 166.3p.
The Takeover Panel gave TVH a deadline of 8 February to make a firm bid earlier this week.
Philip Sparks at Evolution Securities said the approach “is set at a reasonable price and [we] see limited prospects for a rival bid”.
“TVH’s decision to team up with Ashtead is a shrewd move – it reduces the chance of a counter-bid and sends a message that the bidders can maximise synergies,” he said in an investor note.
Lavendon commanded market cap of almost £500m in 2008, but the slowdown in construction activity during the recession caused its share price to plummet.
UBS and RBS Hoare Govett are advising Ashtead during its pursuit of Lavendon, with the UBS team led by Peter Luck, managing director of corporate broking.
Liam Beere, joint head of M&A in Europe, the Middle East and Africa, is senior sponsor of the deal.
Beere joined the bank in 1992, having qualified as an accountant at Price Waterhouse (as it was called then). He studied mathematics and economics at Warwick University.
He advised Segro in its 2009 £110m takeover of Brixton, and hasworked with Capital Shopping Centres through its planned purchase of the Trafford Centre and defence against Simon Property’s £3bn takeover advances. On the RBS side, managing directors of corporate broking Neil Collingridge and Sara Hale lead the team.
Peel Hunt is advising TVH during its takeover interest, with Julian Blunt and Simon Brown leading the team. Brown spent almost four years at the now-defunct Landsbanki before joining Peel Hunt in 2009.