Transfield Shares Are Getting Smashed As The Contractor Rejects An Improved Takeover Offer

Getty / Paula Bronstein

Shares in maintenance and asset management business Transfield were sold down more than 7.5% after the contractor rejected an improved $1 billion takeover bid from Spanish group Ferrovial Servicios.

The new bid for Transfield, a company founded by the Belgiorno-Nettis family, lifted the cash per share offer to $2 from $1.95.

“The Board of Transfield Services has considered Ferrovial’s proposal with the Company’s advisers and has formed the view that the new price of $2 per share still does not reflect the underlying value of Transfield Services shares,” said Diane Smith-Gander, Transfield Services Chairman.

Transfield Services is not expecting further engagement with Ferrovial.

Transfield says trading this quarter has been strong with a good pipeline of growth in energy, defence, government services and infrastructure.

The company announced $73 million underlying net profit for the the year to the end of June. Earnings were up 7% to $217 million.

Transfield says it expects to generate earnings in the range of $240 million to $260 million this financial year.

Its shares are trading today 7.5% down to $1.65. The price has been around $1.905 since the takeover bid.

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