May 9, 2018 / 4:48 PM / 14 days ago

ATON, takeover target Murray & Roberts filing separate S. African merger notifications

JOHANNESBURG, May 9 (Reuters) - German investor ATON and takeover target Murray & Roberts (M&R) are each seeking to file separate merger notifications to South Africa’s Competition Commission - a procedure typically used in hostile takeover situations.

German investor Lutz Helmig’s ATON, which owns more than a third of the South African construction and engineering group, made a buyout offer of 15 rand ($1.19) per share for M&R in March, valuing the company at close to $600 million.

M&R has urged shareholders to take no action, saying the proposed offer “materially undervalues Murray & Roberts based on its prospects and is opportunistic”.

Murray & Roberts said on Wednesday that ATON had made a unilateral application to the South African Competition Commission for permission to file a separate merger notification.

“The Commission has now issued a directive requiring Murray & Roberts to submit its separate merger notification in relation to the ATON offer,” it said in a statement.

Murray & Roberts said it intended to submit its merger notification by the Commission’s May 24 deadline.

The Competition Commission’s merger rules state that either the acquiring company or the takeover target can make a joint filing to the Commission.

Companies can file separately in cases where joint notification is not possible, such as hostile takeovers, the rules say.

In a circular posted to shareholders on April 20, Murray & Roberts’ board had advised shareholders that it believed a merger notification was premature as there was no certainty that the ATON offer would succeed, M&R said.

M&R reminded shareholders that they would only know whether ATON has received the required number of acceptances on June 14, unless the deadline was extended.

A public relations firm representing ATON had no immediate comment.

The German investment vehicle has raised its stake in M&R to 39.8 percent from 33 percent since its bid was announced, after obtaining shares from two top 10 shareholders, including Investment management company Allan Gray, Murray & Roberts’ third largest shareholder.

ATON requires just over 10 percent to achieve its minimum requirement for a potentially successful bid. ($1 = 12.5537 rand) (Reporting by Nqobile Dludla; Editing by Adrian Croft)

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