BUILDERS’ merchant Travis Perkins yesterday began four weeks of due diligence on BSS, the plumbing and heating supplies firm, as prospects of a counter-bid began to fade.
Travis Perkins made a £533m play for BSS on Friday in a move that would see it overtake Wolseley as Britain’s biggest building products distributor. Some of BSS’ largest shareholders, who include BlackRock, Schroders and Axa, are understood to support the indicative offer of 232.91p in cash and 0.2608 Travis Perkins shares per BSS share, plus BSS’ final dividend of 6.09p.
City bankers hoped for a bidding war that would throw off lucrative fees. But this weekend it appeared Travis Perkins had set the price bar too high for mid-market private equity firms to be interested, while the most plausible trade buyer – French group Saint Gobain – has said it will divest its glass packaging business before it makes any acquisitions.
A source close to the process said: “The transaction’s got a long way to go before it completes so it’s not impossible [that another bidder will gatecrash], but it’s unlikely.”
Consolidation in the construction sector has been long expected as government spending cuts will soon bite.