Macmahon Holdings has rejected the latest takeover offer from Indian-owned firm Sembawang Australia, saying it was incapable of being practically implemented.
Macmahon has already struck a $29.6 million deal with Leighton Holdings over the sale of its troubled construction business, and had rebuffed previous offers by Sembawang.
But the wholly-owned subsidiary of engineering and construction group Punj Lloyd last week lodged a new offer, valuing Macmahon's construction business at $35 million.
After meeting with Sembawang in recent days, Macmahon said today that the new offer could not be practically implemented, and was not superior to its deal with Leighton.
While Sembawang's offer price was higher than Leighton's, it was not enough to make up for the added risks associated with the proposal, Macmahon said.
"Sembawang has no operational or management presence in Australia, nor the pre-qualifications and accreditations required by Macmahon's construction customers," the company said in a statement.
"This would make it extremely unlikely that our customers would transfer the contracts to Sembawang.
"The proposed transaction with Leighton remains the best and only transaction practically capable of being completed," it concluded.
MacMahon shares were down 1.5 cents, or 4.2 per cent, at 34.5 cents at 1038 AEDT.
They rose last week when the new offer from Sembawang was lodged.
An extraordinary general meeting at which shareholders will vote on the Leighton proposal is scheduled for February 26.
