Pilkington close to accepting revised Japanese bid offer

Glassmaker Pilkington is said to be preparing for official talks with its smaller Japanese suitor, which could see it taken over this week for more than £2 billion.

Last week Pilkington rejected a prospective offer of 150p a share from Nippon Sheet Glass, which valued the company at £1.97bn, but according to reports yesterday, Pilkington chairman Sir Nigel Rudd may be prepared to agree to an offer of at least 165p a share from Nippon - valuing the company at £2.16bn.

It is understood that Sir Nigel is determined not to undersell the Merseyside firm and may start negotiations by demanding 170p from Nippon.

Last week, Pilkington told Nippon that its proposed offer of 150p a share fell "materially short of a price which the board is prepared to accept". Nippon already owns nearly 20 per cent of Pilkington and it was thought it could generate savings from combining its UK subsidiary NGF Europe with the headquarters of Pilkington as they are both based in St Helens.

Shares in Pilkington closed at 151.5p on Friday, a week after hitting a five-year high of 153.25p.

The share price has more than doubled in the past two years as rumours of a takeover swept the market.

French firm Saint-Gobain, which owns the Jewson building materials chain and is currently locked in a hostile takeover battle for plasterboard maker BPB, has also been mentioned as a potential suitor of the 178-year-old company.

Last week, Pilkington posted a 22 per cent hike in first-half profits to £99 million, despite tough market conditions and soaring energy costs. A 9 per cent rise in revenues to £1.3bn was driven by its core business of supplying car and construction companies, boosting profits in the six months to the end of September.

Pilkington employs around 24,000 people and has plants in Birmingham and Doncaster. It has sales and distribution operations in over 130 countries.

600450 Pilkington close to accepting revised Japanese bid offer glassonweb.com
Date: 8 November 2005
Source: business.scotsman.com

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