18/12/2014 - 11:53

REL up 86% on takeover tick

18/12/2014 - 11:53

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Shares in Perth company Resource Equipment have climbed 85.7 per cent today after the board recommended a cash takeover offer valuing the company at $115.5 million.

REL up 86% on takeover tick
REL specialises in the supply of complete pumping and dewatering systems, power generation, air compressors and associated equipment.

Shares in Perth company Resource Equipment have climbed 85.7 per cent today after the board recommended a cash takeover offer valuing the company at $115.5 million.

The offer, from private US company Pump Services, was pitched at 26 cents per share, an 86 per cent premium to its last trading price.

The all-cash bid is unconditional.

REL’s board also warned that liquidity of the shares will further fall as shareholders accept the offer.

Pump Services is owned by Walter “Loddie” Naymola, who holds an existing stake in REL after the acquisition of Queensland based Campbell Mining Services in September, in which Mr Naymola held a share.

Mr Namoyla is a pioneer of the pump hire industry.

It is understood Mr Namoyla had a 12.7 per cent holding at the opening of trade, and with large turnover in the stock today, he may now hold as much as 40.9 per cent.

Bell Potter Securities is acting as broker to the transaction, with Gilbert + Tobin acting as REL's legal adviser.

REL specialises in the supply of complete pumping and dewatering systems, power generation, air compressors and associated equipment to mining, oil and gas, heavy engineering and infrastructure businesses.

The company had a subdued 12 months to June 30 2014, with a 75 per cent fall in EBITDA to $5.2 million. 

REL traded at 26 cents per share at the time of writing.

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