Results reported on Tuesday offered some further insight into mergers and acquisition deals carried out by Australian listed corporates.
After shareholders heavily sold off Perenti when it announced it had acquired DDH1 for more than $300m last year, investors said that the acquisition had so far shown to be a positive for the group.
Shares did fall almost 2 per cent on Tuesday, but this was despite no bad news surrounding the deal and its integration with Ausdrill going smoothly.
The DDH1 business contributed to the result for nine months.
Shareholders liked Ansell’s results after it purchased Kimberley Clark’s Personal Protective Equipment unit for $990m in April although the acquisition is not yet reflected in its numbers, but the company emphasised strong synergies existed for the acquisition.
Shares closed up almost 9 per cent.
The same can be said for Macmahon Holdings and its Decmil acquisition, with shares closing more than 8 per cent higher after they crashed on news of the $47m deal in April because it was re-entering a high risk space of non-mining-related contract work.
Yet again, the numbers are yet to be reflected in the result.
It’s a sharp contrast to Orora, where shareholders have been disappointed by the performance of its Saverglass acquisition last year.
The view is that Orora overpaid for the acquisition, outlaying $2.1bn, and it downgraded earnings after the deal.
US private equity firm Lone Star has since bid for Orora, and the Wall Street Journal reported this week that Lone Star has also purchased US-based Carrier Global’s commercial and residential fire business for $US3bn in a clear signal it is on the acquisition hunt globally.
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