Crescent submits takeover bid for Australia's Cardno

The private equity firm is willing to buy one out of every two shares - excluding the 19.62% it already owns - in Cardno at A$3.15 apiece. This represents a 26% premium to the September 11 closing price. Having received a cash payout for half their holdings, shareholders can either sell the rest on the market or hold on to them.

Should the offer be fully taken up, Crescent would pay approximately A$215 million ($152.7 million) and hold a 58.91% interest in the company. The GP is operating through its fifth fund, which closed late last year at the hard cap of A$675 million.

"Our focus will be on ensuring the board actively drives the strategic direction of the company, instills strong management discipline and accountability across Cardno's business and oversees the appropriate management of capital to deliver profitable growth, and create value," Michael Alscher, managing partner at the PE firm, said in a statement.

Crescent noted that Cardno faces numerous challenges, having seen its share price drop from A$7.56 in July 2012 to A$2.40 at the time of the offering, while there has been negative earnings growth of 21% per annum over the three years to June 2015. Two executive officers have also quit since the start of 2014.

Although revenue grew to A$1.43 billion in 2015 from A$1.31 billion the previous year, Cardno swung from a net profit of A$78.1 million to a net loss of A$145.2 million. EBITDA fell from A$141.7 million in 2014 to A$108.4 million in 2015.

The company was hit by reduced demand for oil and gas services in the US while the commodities downturn in Australia prompted a wind-down of major project work and delays in infrastructure investment.

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• Topics
• Buyouts
• Industrials
• Australasia
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• Infrastructure
• Australia
• buyout
• Crescent Capital Partners
• Commodities