Why Murray and Roberts thinks Aton’s offer is too cheap

Murray & Roberts, a leading engineering and construction company, has made headlines recently for rejecting a buyout offer from Aton, a German-based private investment holding firm. Aton, which already owns 29 percent of Murray & Roberts, made a bid to acquire the rest of the shares directly from shareholders at R15 an ordinary share. However, the company's Group CEO, Henry Laas, has spoken out against the offer, deeming it 'too low.' In an exclusive interview with CNBC Africa, Laas highlighted his concerns about the offer price and the aggressive approach taken by Aton. Laas expressed his surprise at the offer, stating that while Aton's initial investment in the company hinted at a possible takeover, the price offered was far below what the board considered fair. He also raised issues with the hostile nature of the bid, as Aton did not seek the board's support before approaching shareholders directly. Laas pointed out that other major shareholders, such as Old Mutual, had also rejected the offer, citing similar reasons. One of the key points of contention for Murray & Roberts is the valuation of the company. Despite significant transformations in recent years and strong performance relative to peers in the construction sector, Laas believes that the offer does not reflect the true value of the company. He noted that the offer price, while appearing as a premium to the pre-offer trading price, would only match Aton's initial investment in the group, indicating a lack of appreciation for the company's growth potential. Another critical issue raised by Laas is the potential impact on shareholders. While the board has a responsibility to act in the best interests of shareholders, Laas emphasized that the current offer falls short of representing fair value. The board cannot recommend the transaction at the current price and has instead urged shareholders to consider the long-term prospects of the company before making a decision. The situation at Murray & Roberts has drawn comparisons to past high-profile takeover bids, such as Anheuser-Busch's acquisition of SABMiller. With Aton's bid raising questions about the company's future ownership and strategic direction, stakeholders and industry observers are closely monitoring the developments at Murray & Roberts. The board remains steadfast in its stance that the current offer is inadequate and will await further guidance from independent experts before proceeding with any potential deal. As the saga unfolds, the fate of Murray & Roberts hangs in the balance, with the board and shareholders at odds over the valuation of the company. While Aton's bid may have stirred up uncertainty, the company's leadership is determined to uphold the interests of all stakeholders and secure a deal that accurately reflects the company's value and potential.