Daimler and Rolls hike bid for Tognum

 
City A.M. Reporter
DAIMLER and Rolls-Royce have written to Tognum with a higher takeover offer, according to two people close to the situation.

The move comes after speciality engine maker Tognum said during the weekend that two bidders had signalled in talks they were willing to raise their bid.

A raised bid could bring a two-month long takeover tussle closer to conclusion, although some shareholders, including ING and First Eagle Investment Management, may hold out for more.

Tognum had said it was told by Daimler and its British co-bidder on Friday they would raise their bid to €26 (£22.65) from €24 per share if the target company supported such an offer.

Tognum had added it was yet to receive the offer in writing. The sources said yesterday that these documents had now been submitted.

Tognum and Daimler declined to comment. Rolls-Royce was not immediately available for comment.

An increased bid, which would value Tognum at €3.4bn, would be an about-face for Daimler, which has insisted there is no need to raise its offer. Several institutional and retail investors in Tognum have rejected that offer.

Dutch bank ING, which holds a nine per cent stake in Tognum, had argued in March that Tognum’s fair value, including a portion of expected synergies from a tie-up, would be as much as €32 per share. Other shareholders who rejected the initial offer as too low included First Eagle.

Rolls-Royce hopes Tognum’s technology will make its plane engines more efficient.