Multiplex moves

Retail investors were largely locked out of the highly anticipated $1.2 billion float of Multiplex Group in late 2003, and perhaps it was a blessing in disguise.

Multiplex investors are being offered $5.05 in cash for each of their shares in a $4.3 billion off-market takeover bid by Canadian asset management group Brookfield Asset Management Inc.

Multiplex’s board is supporting the offer, which is more than $1 below the stock’s all-time high of $6.15 that was struck on February 2 2005, before problems with its Wembley stadium project in the UK sent its shares spiralling to $2.27.

It has taken the past two years for the share price to claw its way back.

Multiplex shares closed at $5 before it was revealed on Tuesday that the children of company founder John Roberts had struck a deal with Brookfield to sell their 25.6 per cent stake for almost $1.2 billion.

Returns for investors who have held shares since Multiplex hit the boards on December 2 2003 have been reasonable, but not brilliant.

The company, founded by John Roberts 45 years ago, raised $1.2 billion by issuing shares at $3.08 each with a final instalment of 98 cents per share due 12 months after listing.

The initial share offer was four-times oversubscribed but many mum and dad investors missed out on getting shares to big institutions, which consumed the scrip by gaining allocations for their own clients.

Taking into account dividends generated by the stock, Multiplex has returned shareholders a total of 42.5 per cent since listing.

During the same time, the S&P-ASX 200 index has surged about 90 per cent, and that excludes the impact of dividend payments.

“It was a reasonable investment,” DJ Carmichael & Co director Mike Munro said.

“You could have done worse but you could have done better.’’

Multiplex said Brookfield’s offer valued the company at about $7.3 billion on an enterprise value basis and represented a 31 per cent premium on the one-month volume weighted average share price of $3.94 prior to its January 25 announcement that discussions between the Roberts family and Brookfield were taking place.

The Canadian firm needs to secure at least a 50.1 per cent stake for its offer to become unconditional.

Andrew Roberts, Tim Roberts and their sister Denby Macgregor have resigned from the executive positions within Multiplex.

The company has also appointed acting joint managing directors Bob McKinnon and Ross McDiven as joint managing directors of the company.