The Swiss measuring equipment maker, Leica Geosystems, has rejected a formal takeover bid by the Swedish engineering concern, Hexagon.This content was published on June 27, 2005 - 10:18
The Swiss group said the offer made on Monday of SFr440 ($347) per share – worth about SFr1 billion - was too low.
"The board has considered the offer [and] came to the conclusion that the Hexagon offer does not reflect the actual value of the company and its excellent growth potential," Leica Geosystems said in a statement.
The Hexagon offer was three per cent less than the closing price of SFr454 on Friday.
The offer runs from July 11 to August 5 and is conditional on at least 50.1 per cent of shareholders’ approval.
Leica Geosystems had already rejected Hexagon’s offer when it was first made informally on June 13.
Analysts have said that the company’s true worth is closer to SFr500 to SFr520 per share.
Shares in the Swiss company have leapt about 20 per cent since Hexagon said it planned to bid for Leica Geosystems.
"We continue to advise our shareholders to take no action," Leica Geosystems CEO, Hans Hess, said, adding that the company’s board will publish its official opinion on the bid no later than July 15.
"Our formal response will clearly demonstrate why shareholders will be better served by Leica Geosystems’ value creation plans in both the short and medium term," Hess said.
swissinfo with agencies
Leica Geosystems is the second-largest producer of surveying equipment worldwide.
The company, with headquarters in canton St Gallen, employs more than 2,400 people in 23 countries.
The technology firm, Hexagon, employs 6,400 people in 25 countries and has its headquarters in Stockholm.
Hexagon has an annual turnover of around SFr1.4 billion, about twice as much as Leica Geosystems.
The Swedish company reported a profit of SFr61 million last year while the Swiss group registered a profit of SFr50.6 million – nearly ten times that of the previous year.
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