Merger talks end in Bradken sinking
SHARES in mining services group Bradken have taken a hit after the company received a formal notice of the termination of merger discussions with a Chilean company.
The notice came after Bradken declined to extend a 60-day due diligence exclusivity deal.
The consortium of Magotteaux owner Sigdo Koppers and private equity group Champ had made a $70 million invest- ment in Bradken in late June through a convertible preference share deal.
The conversion period for the investment still expires at the end of December 2016.
Bradken said last week that the near-term benefits of a merger with Sigdo Koppers’ Magotteaux division were less apparent than the longer-term opportunities.
But the consortium had said it was unable to make a bid for the target at the time.
In the year to June 30, Bradken posted a net loss of $241.3 million, down from the previous year’s $21.5 million profit.
Bradken’s share price has dropped more than 75 per cent since January 1.
Bradken shares yesterday closed down 2.1 per cent to $1.16 against a benchmark index fall of 0.2 per cent.