Shares in Melbourne-based crane operator Boom Logistics ended up more than 36% yesterday after the company became the latest small or mid cap industrial to receive an approach from a private equity group.
Boom shares closed up 10.5c at 40.5c, a rise of 35% after being up around more than 40% at one stage.
Boom Logistics lodged a notice with the ASX responding to media speculation that private equity group Archer Capital and Queensland-based transport, mining services and crane hire company McAleese Group intended to make an offer for Boom at 52 cents per share.
"Boom has not received any proposal from Archer or McAleese since Archer acquired a relevant interest in McAleese shares," Boom said in the statement to the ASX.
"Boom has received a highly conditional, confidential and incomplete proposal from Archer to acquire Boom through a scheme of arrangement, at an indicative price of 52 cents per share."
That valued Boom at $240 million.
Boom said its board had not formed a view on the proposal.
‘‘In line with the recent market announcements, management are in the process of quantifying the impacts of the improved operating environment and the contract wins on the expected financial performance of the business,’’ Boom said.
‘‘Once the outcomes of this work are finalised, the board will be in a position to assess any proposal.
‘‘The Boom board advises its shareholders to take no action at this stage.’’
Boom announced to the market yesterday evening that it had secured three contracts expected to generate around $50 million in revenue over the next three years.
The announcement closely followed a substantial shareholder notice lodged with the ASX which indicated that Archer had taken a stake in Boom of about 10.5%.
Boom will have a tough time fighting off the bid, if it’s made formal.
The proposed offer price of 52c a share is under the 52 week high of 57c and well above the low of 21c.
The company has underperformed since 2007 when the share price was above $3. It has lost money on contracts, had management changes and lost contracts.
An earnings upgrade from AGL Energy yesterday put some life into the shares of the utility.
The company told the ASX that it now expects to earn a bit more in the 2010 financial year.
"AGL Energy Limited said that it expects to report "an Underlying Net Profit After Tax (NPAT) for the year ending 30 June 2010 of between $420 million and $430 million, compared with the previous guidance of $390 million to $420 million.
"The revised guidance is based on unaudited figures for eleven months to 31 May 2010, and reflects the continued strong performance of AGL’s underlying business.
"The 2010 full-year results will be released on 26 August 2010."
That sent the shares up 1.8%, or 26c, to $14.33, still more than a dollar under its most recent peak reached in mid April.
In February, AGL reported a 22% rise in first half underlying profit to $234.8 million, but said then it expected a weaker second half.
Statutory net profit for the first half was $183.7 million, down 89% from the prior corresponding period in which a $1.46 billion gain was booked from asset sales.
It’s not often we get an independent experts report in a takeover that says the proposed offer is worth less than the target’s shares are valued at.
Usually these reports suggest the share price is about right, sometimes a bit low, sometimes a bit high, but fair and reasonable.
Yesterday the independent expert’s report for the valuation of Arrow Energy, which is facing a bid from Shell and PetroChina, concluded that Arrow Energy’s shares are worth between $4 and $4.40 each, compared to the agreed $4.70 cash bid launched by Shell and PetroChina.
It took 192 pages of report to make that point. As a result the shares edged up 5c to $4.90.
Shell and PetroChina in March raised their offer to $4.70 a share in cash for Arrow’s Australian assets plus one share in a new listed entity to be called Dart Energy, which will house the group’s Asian exploration assets and some Australian assets.
So it’s no wonder that Deloitte, the independent expert found that the offer was OK.
"In our opinion the Acquisition Scheme is fair and reasonable and therefore in the best interests of Arrow Shareholders."
And QBE Insurance Group has assured the market that it has significant reinsurance protection in place for claims relating to the BP oil rig disaster in the Gulf of Mexico.
QBE is a major player in the Lloyds of London reinsurance market where some or any of the insurable cover for BP and the other companies involved, Transocean, Halliburton, Cameron International, Mitsui and Anardako.
QBE said it had been contacted by investors and others with queries about its cover.
On April 28, QBE confirmed that its estimated large risk and catastrophe claims, which are defined as net claims of $2.5 million and above, for the year to date were $470 million.
At the time, CEO, Frank O’Halloran, said that despite the unusual frequenc
