Indian firm claims unfair deal in bid for Australian construction unit
05 January 2013
A subsidiary of Indian engineering construction major Punj Lloyd has accused Australia's Macmahon Holdings of unfairly blocking its bid for its construction arm, which was sold to its rival, Leighton Holdings.
Richard Grosvenor, chief executive, Sembawang Engineers and Constructors – a subsidiary of Punj Lloyd Ltd – said the company was planning to challenge the validity of the deal between Macmahon and Leighton Holdings in a London court.
According to Sembawang, it had indicated its interest to acquire the construction business of Macmahon, Australia's leading contract mining and construction company, in November 2012. It had initiated its interest via an electronic exchange with Macmahon's CEO, Ross Carroll, and the company had also confirmed that its chairman and board was aware of Sembawang's interest in the construction business.
''Sembawang has been eyeing Macmahon's construction business for the last four years and have expressed our interest to Macmahon as early as November 2012,'' says Grosvenor. ''We are disappointed that we were not approached by Macmahon when it wanted to divest its construction business.''
According to him, Sembawang had offered to purchase all the construction businesses as going concerns and had also proposed an additional consideration of A$5 million over Leighton's offer. ''We urge Macmahon's independent directors to consider both parts of our offer in the best interests of shareholders,'' he added.
Macmahon, in which Leighton is a major shareholder with a 24.2-per cent stake, admits that it had received ''an unsolicited, non-binding, incomplete and conditional proposal'' from Sembawang.