Building materials supplier Adbri has announced that it has received a takeover offer from U.S.-listed CRH and the Barro Group, valuing its equity at approximately $1.41 billion.
Evaluating a Lucrative Cash Offer
Adbri is currently evaluating a cash offer of 3.20 Australian dollars (US$2.14) per share. To allow the bid group sufficient time for due diligence, Adbri has granted them exclusive access to its books until February 28.
Major Shareholders and Financial Details
The Barro Group currently owns 42.7% of Adbri's stock, while CRH holds a 4.6% interest through a cash-settled derivative.
The takeover offer represents a 41% premium to Adbri's closing share price of A$2.27 on Friday. Despite this, Adbri's shares have declined by approximately 19% since reaching a peak in mid-August prior to its first-half earnings report.
Strong Real Estate Market in Australia
Despite a significant increase in interest rates, Australia possesses one of the world's hottest real estate markets. This has created robust demand for construction materials, which were in high need during the pandemic as households utilized stimulus funds to renovate their homes.
Government Initiatives Supporting Housing
To further bolster the housing market, the Australian government has taken measures to assist homebuyers and renters. They recently introduced a new housing fund worth $6.6 billion, aimed at financing the construction of tens of thousands of new homes in the years to come.