ONESTEEL has launched a $145 million takeover for the shares in New Zealand-based Steel & Tube Holdings it does not already own.
OneSteel, which holds a 50.27 per cent interest in Steel & Tube, is offering $NZ4.00 for every share in the company it doesn't own, valuing the deal at about $NZ175.47 million ($A145.4 million).
Steel & Tube shares closed at $NZ3.00 on Friday.
"If OneSteel's offer proceeds, it will allow OneSteel to simplify its corporate structure and efficiently manage the Steel & Tube business as part of the OneSteel group," chief executive Geoff Plummer said in a statement.
OneSteel intends to fund the offer from existing debt facilities and will seek a unanimous recommendation from the Steel & Tube board, in the absence of a superior proposal.
Steel & Tube intends to commission an independent expert's report in relation to the offer before making a formal recommendation.
"The opportunity for all Steel & Tube shareholders to be able to receive cash is attractive given the illiquid market for Steel & Tube shares and the current economic uncertainty and market volatility," chairman Peter Smedley said in a statement.
Steel & Tube is New Zealand's largest distributor of steel and allied products, and was formed in 1953 through the merger of three importers and distributors of steel product.
OneSteel, formerly Tubemakers of Australia, acquired an initial eight per cent holding in 1984 to facilitate the exit of family interests and progressively increased that stake to 46 per cent by 1988.
Shares in OneSteel dipped one cent to $5.31 by 1125 AEST. ----------
dipped a lot more than one cent by 4pm :(
OST Price at posting:
$4.51 Sentiment: LT Buy Disclosure: Held
