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FLSmidth and Weir Group step up bidding war for Ludowici

World Coal,

Brisbane-based Ludowici has found itself at the centre of a bidding war following rival bids from Weir Group and FLSmidth, the Danish engineering company that kicked off proceedings with a AU$ 7.20/share bid at the end of January. Since then, Weir had waded into the action with a counterbid of AU$ 7.92/share on 10 February and an application to the Australian Takoeovers Panal that FLSmidth not be allowed to raise its bid because the Danish company had said its original offer was final. Under Australia’s takeover rules, a bidder cannot later make a higher offer if it has made what is known as a last and final statement.

However, it seems there is still someway to go before a winner is announced. Australia’s Takeovers Panal has allowed FLSmidth to raise its bid but on the condition that the Danish company makes shareholders aware that any higher bid will not be binding until the Takeovers Panal has ruled on Weir’s application.

FLSmidth have duly hit back with an offer of AU$ 10.00/share, valuing Ludowici at AU$ 358 million and promised to “take whatever steps it deems appropriate in defending itself against Weir's application to the Australian Takeovers Panel.”

But with Ludowici’s stock closing at AU$ 9.80, even this may not be a killer blow. It seems this story has a while to run yet. 

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