Investors lash out at Delta over US bid

David Hellier
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DISSIDENT shareholders in engineered steel group Delta have called on other investors to block an agreed takeover offer for the company by Valmont of the US.

Valmont has offered 185p a share to take control of Delta, valuing the engineering group at close to £300m.

But activist investor Crystal Amber has complained that the offer is worth just 180.2p after the cancellation of Delta’s last dividend – sprung on investors just four days before it was about to be paid – is taken into account and is urging other investors to act quickly in order to block the deal.

Crystal Amber said: “Valmont is offering a low price for Delta and Valmont shareholders will be the beneficiaries of this proposed takeover.”

The fund manager added: “In the period since the announcement of the offer up until the close of business on 18 March 2010, the stock market capitalisation of Valmont has increased by £173m at an exchange rate of £1 for $1.50.”

Delta, which has a large pension liability, declined to comment on the controversy yesterday.

A City insider said the board of Delta had been dealing with the situation for a very long time and worked very hard to find a buyer.

“It is very difficult to get more value given the size of the pension liabilities and the South African assets,” the insider said.

Delta is being advised in the bid discussions by NM Rothschild.

Guy Brown, an analyst at Arden, echoed Crystal Amber’s view, saying: “Valmont would like this deal... I could make the bid work at 200p.”