Barro increases its stake in Adelaide Brighton while unusual takeover talk swirls

BARRO Properties has increased its stake in Adelaide Brighton to 41 per cent as speculation mounts that the latter will buy out part of the former.

BARRO Properties has increased its stake in Adelaide Brighton to 41 per cent as speculation mounts that the latter will buy out part of the former.

Under creep provisions, Australian companies over the 19.9 per cent takeover threshold can buy another 3 per cent of a listed company every six months. Barro has exercised this right, moving from 38 per cent to 41 per cent.

It flagged the move with the ASX earlier this week saying it would buy 19 million shares at $6.75 each, but had no intention of making a takeover bid for the company.

But there was speculation on The Australian’s website yesterday that AdBri might be looking to buy the cement business owned by the Barro group, estimated to be worth $500 million.

The report said that while speculation in the past had focused on Barro taking over AdBri, it might be the opposite scenario which eventuates.

AdBri, which owns a cement factory at Osborne, posted a 2.3 per cent drop in profit to $182 million this week after the cement and masonry supplier took a $17.7 million earnings hit from the discovery it had been underpaid for some supplies. Managing director Martin Brydon said the company was in a strong position however, and was set up to deliver “attractive shareholder returns”.

AdBri shares closed at $6.71 yesterday, up 1.5 per cent.

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