The board of Decmil Group (ASX:DCG) has unanimously recommended shareholders vote in favour of a takeover bid from Macmahon Holdings (ASX:MAH).
Under the scheme of arrangement, Macmahon, which has a market capitalisation of $527.97 million, will acquire all Decmil shares for $0.30 per share.
The offer provides Decmil shareholders with a 76.5% premium over the last closing share price of $0.17, as well as an 81.8% premium to the 30-day volume-weighted average price.
Under a separate scheme of arrangement, Macmahon intends to acquire all Decmil redeemable convertible preference shares (RCPS) on issue for $0.343 each.
Decmil, which has a market capitalisation of $26.44 million, says its board team has unanimously recommended that scheme participants vote in favour of the schemes.
Subject to the necessary approvals and conditions, the scheme is expected to be implemented by the end of August 2024.
Decmil Chairman Andrew Barclay says Macmahon’s all-cash offer provides shareholders the certainty that Decmil’s position as a standalone company cannot guarantee.
“While I have absolute confidence in Decmil’s future operational and financial performance as a mid-size player in the civil engineering sector, without the assistance of an extensive balance sheet offered by companies such as Macmahon, achieving full recognition for that performance is not without challenge,” Barclay says.
“Based on those considerations, the offer from Macmahon therefore provides a compelling outcome for securityholders, to realise immediate value for the Decmil shares and Decmil RCPS.”
Decmil directors and shareholders represent a combined 27.8% of Decmil shares on issue and 40.1% of Decmil RCPS on issue, which indicates an intention to vote in favour of the transaction.
Upon completion of the transaction, Macmahon will operate Decmil as a wholly owned subsidiary, merged with Macmahon’s existing civil business under Decmil’s branding.
Macmahon is a mining services company focused on offering packages to miners throughout Australia and Southeast Asia.
Decmil Group is a multidisciplinary project services company focused on delivering integrated construction and engineering solutions across the resources, infrastructure, and renewables sector.
Write to Aaliyah Rogan at Mining.com.au
Images: Decmil Group
