Scottish engineering company Weir Group said yesterday it would withdraw from a bidding war for an Australian mining-equipment firm.
Weir had matched a £243million takeover offer for Ludowici from FLSmidth but decided to back down after its Danish rival increased its bid to more than £265million.
Glasgow-based Weir had called on Australia’s takeover panel to block FLSmidth’s improved offer after the Danish firm’s chief executive, Jorgen Huno Rasmussen, said its initial approach was final.
Under Australian takeover law, a company which declares a bid to be final can be held to that statement and prevented from raising the offer, but Mr Rasmussen later retracted his comments and the panel cleared the acquisition.
Weir chief executive Keith Cochrane said that the company was not willing to increase its bid after FLSmidth trumped its offer.
He added: “While Ludowici represented an attractive opportunity to expand our market-leading Australian business, our focus in any acquisition is to create value for Weir shareholders.
“A materially higher offer would not have met the rigorous financial criteria which we apply to all acquisitions.”
A spokesman for FLSmidth said the firm was delighted there was no longer a rival bid for Ludowici, which both companies had been chasing because of its work in Australia’s fast-growing coal and iron-ore mining sectors.
Weir’s takeover offer for Ludowici came after a series of acquisitions in recent months.
In November, it bought Seaboard Holdings for £433million and earlier this year it acquired Novatech for £113million.
FTSE 100 company Weir has a presence in more than 70 countries, with 13,000 staff worldwide.
It employs more than 500 people in Scotland spread between its Glasgow headquarters, Alloa and Aberdeen.
The Granite City operation services the upstream oil and gas industry.