Ann: Takeover Offer for Primero Group Limited, page-63

https://thewest.com.au/business/con...keover-offer-from-nrw-holdings-ng-b881755251z
Primero directors to sell into takeover offer from NRW Holdings

Daniel NewellThe West Australian
Wed, 23 December 2020 10:50AM
Daniel Newell


Primero boss Cameron Henry


Directors of Perth-based Primero have thrown their weight behind a $100 million takeover offer from fellow engineering contractor NRW Holdings.

Their acceptance of last month’s off-market bid has tipped almost 31 per cent of Primero’s ordinary shares into NRW’s now near 50 per cent stake.

“The Primero directors continue to unanimously recommend that shareholders accept the offer in the absence of a superior proposal,” NRW said in a market update today.

The cash and scrip bid values Primero at 55¢ a share, providing investors with 27.5¢ cash and 0.106 NRW shares for each security. The offer closes on January 22.

The timely offer helped mid-tier Primero, which made its market debut just two years ago, avoid a capital raising to fund its growing order book following a major contract dispute over an Adelaide power station.

Managing director and major shareholder Cameron Henry said last month the board’s decision was primarily driven by the strategic benefits of the tie-up with NRW but he admitted the contract dispute with Wartsila Australia was also a factor, along with a reluctance to embark on a “significantly dilutive” raising.

Primero is chasing more than $60m it says it is owed for work on the Barker Inlet power station in Adelaide, arguing changes to the design and variations had extended the scope and value of the contract.
It was awarded $16.9m by an adjudicator, only for a South Australian court to overturn the decision in September.

Primero specialises in the design, construction and operation of mining projects and has so far secured contracts worth $285m for this financial year and holds preferred engineering, procurement and construction contractor status across projects totalling $900m.

It will be NRW’s fourth purchase since 2017.

Shares in Primero were down 2.7 per cent at 10.30am to 54.5¢ while NRW was off 4¢ to $2.83.