Seven Group makes $1.2bn offer for Boral

Seven Group Holdings (SGH) has made a $1.2 billion offer to move to full ownership of building products group Boral, adding to the Perth company’s diverse group of media and industrial companies.

SGH currently holds 71.6 percent of Boral, with the offer pitched at 0.1116 SGH shares and $1.50 cash per Boral share – an aggregate value of $6.05 per Boral share. The company’s shares closed on the ASX last night at $6.12.

Boral advised shareholders to take no action at this stage and established an independent board committee to consider and respond to the offer.

Boral has been a poor performer, losing its shirt in an ill conceived foray into the North American market – total revenue in FY22 was 26.9 percent below the previous financial year’s $5.3 billion at $3.908 billion.

The company was forced to sell off its North American building products business, its 50 per cent owned Meridian Brick business and its Australian building products businesses in the exit from North America.

After the return of $3 billion to shareholders – never a sign of confidence in any company – Boral replaced its CEO and embarked on a restructuring programme.

CEO of SGH Ryan Stokes said the move to full ownership was an exciting opportunity to integrate Boral into the company’s portfolio which includes the Seven media network and the West Australian newspaper, equipment business Westrac, hire business Coates and oil and gas company SGH Energy.

Stokes said: “The integration of Boral as a 100 percent owned business is a natural evolution for SGH, supporting our position as a leading ASX industrial business.

“The integration is expected to support and accelerate the delivery of the current Good to Great performance journey.”

SGH said it had a track record of delivering superior sustainable operating performance of the companies it controls.

Further reading:
Boral slumps makes clear fallout from US disasters
Boral to return $3bn to shareholders after US exit