CSR shareholders back $4.3bn bid from French giant Saint-Gobain

Shareholders have overwhelmingly supported French building giant Saint-Gobain’s acquisition of the 169-year old Australian company.

CSR shareholders have voted to approve a $4.3bn takeover from French building giant Saint-Gobain.

Industrials giant CSR’s time as a publicly listed company will soon be up after its shareholders overwhelmingly voted to accept a $4.32bn takeover by French building giant Saint-Gobain.

More than 98 per cent of votes cast by CSR shareholders were in favour of the takeover – after the company’s directors urged a yes vote.

Once approved, each CSR shareholder is entitled to $9 per share in cash, which comprises $8.88 per share and a CSR-permitted dividend of 12c per share.

The price represents a premium of 33 per cent to CSR’s closing share price on February 20. CSR, established in 1855 as a sugar refining business, has a portfolio of building products, including Monier Roofing, PGH Bricks and Gyprock.

CSR chair John Gillam said there had been tremendous support for the takeover scheme, adding that it had been in the best interest of shareholders to back the deal.

“The attractive value creation for shareholders arising from the planned acquisition by Saint-Gobain is a clear validation of the strategy and its successful execution by the CSR team under Julie Coates’ leadership,” he said at the end of the meeting.

CSR chair John Gillam said the offer was in the shareholders’ interest.

“Saint-Gobain and CSR have strong strategic and cultural alignment and there is an exciting opportunity ahead for CSR’s customers and team for continued innovation and strong performance in the Australian and New Zealand building products industries.”

Saint-Gobain’s main interest in CSR is the plasterboard operation, with speculation it could sell the bricks operation.

CSR said late last year it was investing in factory upgrades and more trucks in an effort to meet surging demand for housing. The French group will also accept liability for the Australian company’s asbestos claims.

CSR’s involvement in asbestos mining ceased in 1966 and it stopped the manufacture of products containing asbestos in 1977.

CSR’s asbestos provision stood at $187.1m in September last year.

During the meeting shareholders were invited to ask questions or express their views about the takeover to CSR’s board. Investors expressed varying views from being in favour to against CSR coming under foreign ownership and concerns about what it would mean for jobs.

“The board considered all stakeholders interested in this, and we are strongly of the view that this is an exciting opportunity for CSR employees in particular, to be part of, to get the opportunity to be part of one of the world’s leading like construction global players,” Mr Gillam said.

He was also probed as to why the company could not achieve the $9 offer if it continued to trade in its current form. He said that the company had done work to understand how best to get value for shareholders and didn’t see any other path going forward.

“Organisations like Saint-Gobain don’t just casually start trading in a new country if they haven’t got a productive capacity to back up what they’re selling, so that they’re looking to participate in this economy by acquiring at a very strong price,” he said.

“At CSR, we were strong in doing the work to understand how best to get value, and that is why we had the meeting today. The thought you’ve put is one that we’ve had strong discussions ourselves around, and we didn’t arrive at.”

The takeover remains subject to the approval of the court at the second court hearing

scheduled for June 18, and certain other conditions precedent.

If the scheme is approved at that hearing, CSR is expected to lodge a copy of the orders with the Australian Securities and Investments Commission on June 19, at which time the scheme will become legal and the company will cease trading on the ASX at the close.

All shareholders will receive a special dividend on July 1 and the scheme consideration of $8.88 on July 9.

Shares in CSR were buying $8.96 in afternoon trade on Thursday.