Siebe withdraws from bid contest for Whessoe

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The Independent Online
Whessoe saw its share price drop 9p to 175p yesterday after Siebe, the engineering group, withdrew its bid for the instrumentation and controls group, leaving the way clear for a continental consortium which mounted a pounds 52.6m counter-offer on Wednesday. The rival bidders, Seatex Garex of Norway and Endress & Hauser of Switzerland, quickly moved into the market to build on a 10.6 per cent stake acquired from three of Whessoe's biggest institutional shareholders and ended the day with 25.6 per cent of their target. Last night, they were waiting for a recommendation for their 175p-a-share offer by the Whessoe board.

The market had been expecting Siebe to raise its 155p-a-share bid, which valued Whessoe at pounds 46m, but Allen Yurko, chief executive, said yesterday: "We do not believe that a significantly increased offer would be in the best interests of Siebe shareholders and the board has therefore decided not to increase the price that it is prepared to pay for Whessoe." He said that its offer was based on sound industrial logic and the "clear synergy opportunities" provided by integrating Whessoe's instrumentation lines with Siebe's control systems division.

He said the group applied "strict criteria" when looking at potential acquisitions, particularly with regard to product technology, growth potential and synergy opportunities.

"Valuation, however, based on current trading conditions remains the overriding issue when considering an acquisition," he added.

Hans Olav Torsen, chief executive of Seatex, which is changing its name to Navia next month, last night urged Whessoe shareholders to accept the consortium's offer. He said: "The Whessoe business fits perfectly with Navia's operations in Norway and those of Endress & Hauser in the United States. We are pleased Siebe recognises that Whessoe has greater strategic value to us."

Seatex is based in Trondheim in Norway. It is hoping to merge Whessoe's Autronica marine automation and fire detection business, also based in Trondheim, with its own operations, which include air traffic control- related systems and shipboard navigation equipment.

Whessoe's instrumentation operations, which include the measurement and monitoring of large storage tanks, are seen as complementary with Endress, a private Swiss company.

Seatex was originally rebuffed after approaching the British group about Autronica at the end of 1995. It returned with Endress earlier this month, but was gazumped by the announcement of Siebe's offer.

Siebe's shares ended 3.5p ahead at 968.5p.