Ferrovial's executives have some tricky decision-making ahead of them in Madrid after Broadspectrum's board issued a resounding rejection of the Spaniards' $1.35 per cash offer.
With top investors backing the rejection, and independent expert Ernst and Young setting a price of between $1.71 and $1.98 as "fair value" for the contractor, Ferrovial needs to consider a serious increase in its offer price or risk the takeover bid failing - for a second time.
When Broadspectrum knocked back an initial $2 bid from Ferrovial a year ago, major shareholders were disheartened by the subsequent fall in the company's share price, but continued to support the company's management team.
This time, with Ferrovial having made an offer direct to investors, shareholders will make their own decision and vote with their feet.
If investors really do believe Broadspectrum has good prospects as a stand alone company, they won't tender their shares into the offer.
Ferrovial will know in coming days if investors, who have been waiting for the target statement before selling their shares, prefer cash now over the chance of longer term growth.
But if the Spanish really want full control of Broadspectrum, and a recommendation from the board, they will most likely need to find some extra cash.
