Bid War for AB Ports

Elena
15 Jun, 2006
New York City

Both consortiums valued the ports company at nearly 2.6 billion pounds ($4.8 billion). Goldman Sachs'' Admiral consortium first revealed it had raised its bid to 840 pence per share, just a day after it had reached agreement with AB Ports for a takeover at 810 pence per share. Port operators have become attractive takeover targets due to their stable income streams, large property portfolios and buoyant shipping markets.

[R]8:00AM A bidding war broke out for AB Ports.[/R]
A bidding war broke out for Associated British Ports Holdings PLC when a consortium led by investment bank Goldman Sachs raised its offer and a rival group led by Australia''s Macquarie Bank Ltd. made a bid at the same level. Both consortiums valued the ports company at nearly 2.6 billion pounds ($4.8 billion). Goldman Sachs'' Admiral consortium first revealed it had raised its bid to 840 pence ($15.46) per share, just a day after it had reached agreement with AB Ports for a takeover at 810 pence ($14.90) per share. In March AB Ports, which owns 21 ports across Britain, as well as a 49% stake in the Southampton container port, had rejected Goldman Sachs'' bid of 730 pence ($13.44) a share.

Counterbid speculation began Wednesday when Dresdner Kleinwort Wasserstein jumped into the market and started buying AB Ports shares. AB Ports said it had also received a pre-conditional proposal from the Macquarie consortium, indicating a cash price equivalent to the Goldman Sachs offer. In the rival consortium are also the Canada Pension Plan Investment Board and Australia''s Industry Funds Management. AB Ports shares jumped 5.1% to 869 pence ($16.06) on the LSE.


[R]7:30AM Asian markets continue to advance, Japan leads the gainers.[/R]
Asian markets finished mostly higher. The Nikkei 225 Index advanced 1.13% to 14470.76. Bank, securities, tech stocks, real estate and mining shares were among the gainers due to investor confidence having been lifted by overnight trading on U.S markets. Mitsubishi UFJ Financial Group advanced 1.42%, and Advantest climbed 2.03%. Mitsui Mining & Smelting soared 10.28% and Sumitomo Realty & Development climbed 1.39%. Hong Kong’s Hang Seng Index also advanced 1.23% to 15435.08. After the market dropped 2,000 points in just a few weeks the market sentiment was firmly in upbeat mood. Some investors remained sceptical, looking at the rebound as more of a technical one. Shares in China, Singapore and Australia advanced too, but South Korea''s Kospi Index retreated from an initial 1.5% gain, shedding 0.5% to 1215.65. The bank sector lead the decline as foreign investors and institutions continued to worry about monetary tightening and global market weakness. Kookmin Bank dropped 1.2%, while Shinhan Financial edged down 1.3%. SK Telecom also fell 2.3%. Taiwan stocks also closed lower, as the Taipei Index shed 0.7% to 6426.39 due to profit-taking canceling some of Wednesday''s 2.1% climb.


[R]6:30AM European stocks make an early recovery on global market rise.[/R]
European markets opened higher in morning trading. The U.K. FTSE 100 index gained 1%, at 5,563, the German DAX Xetra 30 index advanced 1.2%, at 5,366, and the French CAC-40 index climbed 1.2%, at 4,669. On the corporate front, carmakers made gains after stronger than expected European car registrations data with Fiat adding 2.2%, while Renault climbing 1.4% and Volkswagen increasing 1.2%. DaimlerChrysler gained 1.4% and rival BMW edged up 0.9%. The aftereffects of EADS warning about delays to its Airbus A380 superjumbo have incited shareholders into revolt with the aerospace company, which is likely to remain under pressure. French regulators have made it clear that they will look at stock option sales in March by directors of EADS for any evidence of wrongdoing. Bargain hunters lifted EADS up 2.95%.

IPE Brent oil for July delivery advanced 75 cents to $67.73 a barrel in early London trade. The July contract expires at the end of the session. The August Brent contract advanced 66 cents to $69.15 a barrel. Gold jumped $16 to $574.00 a troy ounce, and silver moved above $10 a troy ounce after spending the past two sessions below this level. The dollar was lower against other major currencies in European trading Thursday morning. The euro was quoted at $1.2618, up from $1.2602 late Wednesday in New York. The dollar also dropped against the British pound, which climbed to $1.8448 from $1.8420 the day before. The dollar slid to 115.00 yen, from 115.05 the day before in New York.