THE WEST AUSTRALIAN
Friday, 11 January 2013 08:56
The board of Macmahon Holdings says it needs more detail before it can compare a $38 million competing bid from Singapore for its construction arm with the deal struck with biggest shareholder Leighton Holdings.
Chairman Ken Scott-Mackenzie also said it remained unlikely that Macmahon could break the Leighton exclusivity period deal to allow rival Sembawang Engineers and Constructors to go over its books.
Sembawang has now put a price on the bid it first formally made last week but provided no further information - except to say it included Macmahon's trouble-prone rail business. A secondary offer to acquire certain Macmahon projects for $25 million is unchanged.
The Indian-owned contractor is still seeking to conduct due diligence by the end of this month.
"There's not a hell of a lot of detail there," Mr Scott-Mackenzie said. "We will certainly seek some clarification on that offer. We'll go through the process of considering that and comparing it with the offer we already have from Leighton, which is an offer that comes with a high degree of certainty."
Mr Scott-Mackenzie said Sembawang's offer would be difficult to assess without knowing what was included or excluded.
Under Leighton's $20 million deal to take over most of Macmahon's construction projects, the WA company would retain $40 million of equipment.
Sembawang chief executive Richard Grosvenor said such details would have to wait until due diligence was done.
He believed Macmahon directors did not need Leighton's approval to waive the exclusivity arrangement.
"They can themselves do what they think needs to be done," Mr Grosvenor said. "They do not need Leighton's concurrence."
Mr Grosvenor suggested there were "embarrassing" reasons for Macmahon not wanting to co- operate. "They don't want us in their data room."
Mr Scott-Mackenzie said: "I don't believe that we could allow due diligence to another party. At the same time the directors will exercise their fiduciary duties or responsibilities."
The Leighton deal bars Macmahon directors from negotiating an alternative transaction except when not doing so would breach their fiduciary duties.
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