02.06.2010

Bid for Boom

Archer Capital, reportedly in co-operation with the McAleese Group, has made a takeover bid for Australian Crane and access company Boom Logistics.

The bidders are said to already own 11 percent of the company and have submitted an opening 'indicative' offer of 52 cents a share for the rest of the stock, valuing the company at A$240 million – the shares closed today at 30 cents.

Boom has acknowledged the bid from private equity firm Archer, but says that as far as it knows McAleese is not involved. It says that it will lodge an announcement with the Australian Securities Exchange before trading commences tomorrow.

Boom chief executive Brenden Mitchell said the bid is highly conditional and not a firm enough offer for the board to take it to shareholders.

The bid comes hot on the heels of Boom’s announcement that it had secured three new contracts worth around A$50 million in revenues over the next three years. Including a three year contract to supply cranes to BHP Billiton's iron ore operations in Western Australia which is expected to generate revenues of A$35 million.

The deal covers the supply of cranes and resources for all shutdown and maintenance works at BHP's operations at Nelson Point and Finucane Island in Port Hedland.

The company has also won a three year contract to supply cranes for maintenance works at Anglo American coal operations in Moranbah North and Capcoal mine in central Queensland, worth around $6 million

The third award is a three year extension to its contract with the BP refinery at Kwinana in Western Australia, worth somewhere in the region of A$9 million.

Queensland based McAleese, owned by Harbew, is an acquisitive heavy transport and logistics company which also owns National Crane Hire, Walter Wright Crane and cranes and access equipment distributor Australian Crane and Machinery.

McAleese took a couple of runs at Boom last year offering around 60 cents a share, but Boom's management elected to continue with a rights issue instead. The decision to go public today comes following the slow progress of negotiations with Boom.