Hitachi Construction Machinery lobs bid for Bradken

Embattled mining services concern Bradken has backed a $976.1 million takeover offer from Japanese Baez conglomerate Hitachi Construction Machinery.

Bradken’s board has described the offer as fair and reasonable.

The offer price is $3.25 per share, a premium to Bradken’s $2.43 per closing price.

It represents an implied fully diluted market capitalisation of $688.5m and an enterprise value of $976.1m.

Highbury Partnership is advising Bradken, whose business covers a range of items from mill liners to technical engineering services.

It follows a rally in Bradken’s share price since the start of the year on the back of improving conditions in the mining industry, and just months before the December deadline for private equity firm Champ to execute on the conversion of debt into equity for its convertible note.

Champ launched an opportunistic bid for close to half of the now well-capitalised company earlier this year, when shares hovered around 70c, and has been among a number of companies courting the business.

Pacific Equity Partners, Bain Capital and Koch Industries are also among the parties that have pursued the business in recent years, offering as much as $6 per share.

Today’s deal underlines the more open policy taken by Bradken chair Phil Arnall and his chief executive Paul Zuckerman.

It was confirmed by Hitachi on the Tokyo exchange and later confirmed by Bradken.

Hitachi says Bradken’s management will remain in place after the deal is executed.