Siebe bid may spark battle for APV

Stock market dealers were yesterday anticipating a possible bid tussle for APV after the rival Siebe engineering group launched an agreed pounds 331m offer which would create the world's leading supplier of process control systems for the food, drink and pharmaceutical industries.

APV's shares, which were 66p before it first revealed an approach at the end of April, soared 17p to 106.5p yesterday, just above the Siebe bid terms. Siebe is offering 0.10955 of its own shares for every one in APV, valuing the latter at just above 106p after the Siebe price rose 11.5p to 970p yesterday. Siebe is shaving around pounds 3.5m off its bid costs by underwriting 46 per cent of 97.5p cash alternative from its own resources.

APV announced it had received a second "indication of interest" just two days after Siebe's approach and analysts were yesterday keeping an open mind as to whether a rival would make a counter offer. GEA, a German food processing machinery company which announces its results on Monday, refused to rule itself out of the running, although European competition concerns may prove a constraint. Speculation was also rife yesterday about the intentions of FMC, a big US food conglomerate.

Paul Compton of brokers Merrill Lynch suggested there was still a slim chance of a rival offer. "It might not be all over, but I think it probably is", he said.

There was a general welcome from analysts for the Siebe deal, which comes 11 years after it mounted an earlier takeover attempt on APV. Describing it as a "clip on acquisition" which would be integrated with the Foxboro control systems business, Allen Yurko, Siebe's chief executive, said it offered "clear, no nonsense, up-front synergy benefits" which will enhance earnings and enhance shareholder value "right out of the blocks". He said APV's original plan to shed 500 jobs might possibly be increased to as many as 1,000, with most of the losses coming outside the UK and administrative functions. APV's chief executive, Neil French, is being kept on for at least the transition period, but he could be in line for a payoff of around pounds 600,000 if he goes.

APV has been struggling for years and Siebe is now aiming to raise last year's 3.5 per cent margins to 10 per cent over the next two to three years, implying around pounds 50m of cost savings are in prospect. But Mr Yurko said the main benefits would come from cross selling Siebe's Intelligent Automation process control system, which is now close to overtaking Honeywell as the market leader in this sector, through APV's 1,000 strong sales force operating in 40 countries. Foxboro already has around 1,000 sales staff.

APV will give the group a commanding 11 to 12 per cent share of the market for control systems in the food, drink and pharmaceutical industries, well ahead of 9 per cent share held by Tetra-Laval of Sweden. The purchase will aso fill in another piece of Siebe's product portfolio, which already commands number two or number three slots in markets ranging from oil, gas and chemicals, through power and water utilities to pulp and paper.

Start your day with The Independent, sign up for daily news emails
Life and Style
Steve Shaw shows Kate how to get wet behind the ears and how to align her neck
healthSteven Shaw - the 'Buddha of Breaststroke' - applies Alexander Technique to the watery sport
Arts and Entertainment
The sight of a bucking bronco in the shape of a pink penis was too much for Hollywood actor and gay rights supporter Martin Sheen, prompting him to boycott a scene in the TV series Grace and Frankie
tv
Sport
footballShirt then goes on sale on Gumtree
Voices
Terry Sue-Patt as Benny in the BBC children’s soap ‘Grange Hill’
voicesGrace Dent on Grange Hill and Terry Sue-Patt
Arts and Entertainment
Performers drink tea at the Glastonbury festival in 2010
music
Arts and Entertainment
Twin Peaks stars Joan Chen, Michael Ontkean, Kyle Maclachlan and Piper Laurie
tvName confirmed for third series
Sport
Cameron Jerome
footballCanaries beat Boro to gain promotion to the Premier League
Arts and Entertainment
art
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Neil Pavier: Management Accountant

£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...

Sheridan Maine: Commercial Accountant

£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...

Laura Norton: Project Accountant

£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...

Day In a Page

Abuse - and the hell that came afterwards

Abuse - and the hell that follows

James Rhodes on the extraordinary legal battle to publish his memoir
Why we need a 'tranquility map' of England, according to campaigners

It's oh so quiet!

The case for a 'tranquility map' of England
'Timeless fashion': It may be a paradox, but the industry loves it

'Timeless fashion'

It may be a paradox, but the industry loves it
If the West needs a bridge to the 'moderates' inside Isis, maybe we could have done with Osama bin Laden staying alive after all

Could have done with Osama bin Laden staying alive?

Robert Fisk on the Fountainheads of World Evil in 2011 - and 2015
New exhibition celebrates the evolution of swimwear

Evolution of swimwear

From bathing dresses in the twenties to modern bikinis
Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf
From Shakespeare to Rising Damp... to Vicious

Frances de la Tour's 50-year triumph

'Rising Damp' brought De la Tour such recognition that she could be forgiven if she'd never been able to move on. But at 70, she continues to flourish - and to beguile
'That Whitsun, I was late getting away...'

Ian McMillan on the Whitsun Weddings

This weekend is Whitsun, and while the festival may no longer resonate, Larkin's best-loved poem, lives on - along with the train journey at the heart of it
Kathryn Williams explores the works and influences of Sylvia Plath in a new light

Songs from the bell jar

Kathryn Williams explores the works and influences of Sylvia Plath
How one man's day in high heels showed him that Cannes must change its 'no flats' policy

One man's day in high heels

...showed him that Cannes must change its 'flats' policy
Is a quiet crusade to reform executive pay bearing fruit?

Is a quiet crusade to reform executive pay bearing fruit?

Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
The King David Hotel gives precious work to Palestinians - unless peace talks are on

King David Hotel: Palestinians not included

The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
More people moving from Australia to New Zealand than in the other direction for first time in 24 years

End of the Aussie brain drain

More people moving from Australia to New Zealand than in the other direction for first time in 24 years
Meditation is touted as a cure for mental instability but can it actually be bad for you?

Can meditation be bad for you?

Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

Australia's first-ever Eurovision entrant

Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine