- 01CTL bids $1.62/share for Big River ($156m).
- 0245.9% premium; board and 59.5% holders back deal.
- 03Up to 21c franked dividend possible; approvals pending.
Big River Industries (ASX: BRI) has agreed to a proposed $156 million cash takeover by existing shareholder CTL (Aust) Pty Ltd through a binding scheme implementation deed.
The $1.62-per-share offer represents a 45.9% premium to Big River’s $1.11 closing price on 12 November, valuing the business at an enterprise value of approximately $216m.
CTL already owns 19.9% of the building products group and intends to acquire the remaining shares through a scheme of arrangement.
The binding agreement followed unsolicited non-binding approaches from CTL, a period of exclusivity, confirmatory due diligence, and negotiations between the parties.
The proposal has unanimous board support and backing from major shareholders controlling about 59.5% of Big River, although regulatory, shareholder, and court approvals remain outstanding.
Cash Offer and Dividend Option
The consideration represents a 47.2% premium to the one-month volume-weighted average price of $1.10 and a 35% premium to the three-month VWAP of $1.20, both calculated to 12 November.
Big River may pay a fully franked special dividend of up to 21 cents per share before the transaction becomes effective, depending on available franking credits and cash reserves.
Any cash dividend would reduce the $1.62 scheme payment dollar for dollar, without reducing the value of franking credits attached to the dividend.
The equity valuation uses approximately 96.3 million fully diluted shares, including performance rights expected to convert before the scheme record date.
CTL plans to fund the acquisition using existing cash reserves and debt finance supported by a financier commitment letter, with no financing condition attached to the scheme.
Major Holders Back Proposal
Funds managed by Anacacia Capital and NAOS Asset Management that hold approximately 28.8% and 30.7% of Big River respectively intend to vote their shares in favour.
Their intentions, like the directors’ recommendation, depend on there being no superior proposal and an independent expert continuing to find the scheme in shareholders’ best interests.
Big River chair Martin Monro pointed to the certainty of a cash exit against the risks of pursuing the company’s longer-term opportunities.
“While the board remains confident in Big River’s long-term prospects and growth opportunities, the Scheme provides shareholders with certainty of value in an uncertain operating environment and the opportunity to realise their investment for cash at an attractive premium, which may not otherwise be readily available given Big River’s concentrated shareholding structure and limited trading liquidity,” chair Martin Monro said.
“Big River is a high-quality business with a long history of serving its customers, underpinned by a capable team and loyal customer and supplier relationships—our intention is to support and invest in the business over the long term so we can support its organic and targeted acquisition led growth,” CTL director Shan Kanji added.
Approvals and Completion Timetable
CTL is a privately owned investment vehicle associated with Mr Kanji, whose broader group has manufacturing and distribution interests across Australia and New Zealand.
Completion requires the necessary shareholder majorities, court approval, clearance under the merger regime administered by the Australian Competition and Consumer Commission, and a favourable independent expert opinion.
The agreement includes customary restrictions on competing approaches, subject to fiduciary exceptions, and gives CTL a matching right if a superior proposal emerges.
Reciprocal break fees of $1.56m may apply in specified circumstances, while the parties are targeting implementation in the first quarter of 2027.
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