Metso has rejected the latest takeover offer from the Weir Group.
Earlier this month Weir proposed a merger of the two companies, that would have seen it acquire all of the shares of Metso for approximately €30.49 per share, a 35 per cent premium on the crushing and screening machinery manufacturer’s share price.
However Metso rejected it out of hand, with Weir stating that the manufacturer’s board “did not engage with Weir”.
Metso labelled the offer as ‘opportunistic’, adding that is undervalued the company.
According to Metso “the Board concluded that the revised proposal continues to significantly undervalue Metso and the value to shareholders of Metso continuing as an independent company pursuing its own growth strategy”.
Metso chairman Mikael Lilius explained that "[Metso] has considered the approaches from Weir carefully and thoroughly; we have also carefully considered the opportunities that Metso has as an independent company and its strong growth prospects. We believe that Metso has a real opportunity to create significant value for all its shareholders by pursuing its own course and that the proposal from Weir significantly undervalues this opportunity and that a takeover by Weir at these conditions would not be in our shareholders' best interests”.
The company went on to say the offer came as the mining capital equipment market is experiencing a trough, and the most recent offer ignores the room for upside in the market when the investment cycle turns.
Following this rejection, Weir stated it believed it had made “a compelling proposal, but remains financially disciplined and therefore does not intend to pursue this opportunity further at this time”.
It is understood that a merger of the two companies would have created a company worth around US$ 15 billion.