RIN rinker group limited

rinker board says cemex bid undervalues

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    News Release
    Rinker Group Limited ABN 53 003 433 118
    Corporate Affairs and Investor Relations
    Level 8, Tower B, 799 Pacific Highway, Chatswood NSW 2067 PO Box 5697, West Chatswood
    NSW 1515
    Telephone (02) 9412 6680 Facsimile (02) 9412 6611 E-mail [email protected]
    On Friday 27 October 2006, Cemex S.A.B. de C.V. (“Cemex”) announced that
    it intends to make a cash takeover offer for Rinker Group Limited
    (“Rinker”) at US$13.00 per share, equivalent to A$17.00 per share (based
    on an average exchange rate of A$1.00 to US$0.7645). A copy of that
    announcement was sent to Rinker by Cemex and is attached.
    Rinker Chairman John Morschel said the Cemex announcement indicates that
    the unsolicited, hostile offer will be highly conditional.
    “The preliminary view of the Rinker Board is that the proposed offer is
    opportunistic and materially undervalues the company,” he said.
    Mr Morschel said Rinker’s performance of 40% compound annual growth in
    earnings per share over the past five years, together with strong growth
    in revenue (19% p.a. compound) and earnings before interest and tax (33%
    p.a. compound), has made it one of the best performing construction
    materials companies in the world.
    “Directors will keep shareholders fully informed of further developments
    and will provide a formal recommendation on the offer in ample time for
    shareholders to make an informed decision,” he said.
    “Shareholders should take no action in relation to Cemex’s offer at this
    time or any document received from Cemex until they receive the
    directors’ formal recommendation.”
    Rinker has retained UBS as its financial adviser in relation to the
    proposed offer.
    Rinker is one of the world’s top 10 heavy building materials groups, with
    operations in aggregates, cement, concrete, asphalt and concrete pipe and
    products. Market capitalization is around US$10 billion. Rinker has over
    13,000 employees in over 780 sites across the US, Australia and China.
    Around 80% of group revenue comes from the US subsidiary, Rinker
    Materials Corporation.
    This communication has been made public by Rinker Group Limited (“Rinker”).
    Investors are urged to read Rinker’s Solicitation/Recommendation Statement on
    Schedule 14D-9 if and when it is filed by Rinker with the U.S. Securities and
    Exchange Commission (the “SEC”), as it will contain important information. The
    Solicitation/Recommendation Statement (if and when it becomes available), and
    other public filings made from time to time by Rinker with the SEC which are
    related to the proposed offer by Cemex S.A.B. de C.V. (“Cemex”) (if and when the
    offer is commenced), are available without charge at the SEC’s website at
    www.sec.gov or at Rinker’s website at www.rinker.com.
    This news release contains a number of forward-looking statements based on
    management’s current expectations or beliefs. Such statements can be identified
    by the use of forward-looking language such as “may,” “should, “expect,”
    “anticipate,” “estimate,” “scheduled,” or “continue” or the negative thereof or
    comparable terminology. Such forward-looking statements are not guarantees of
    future results or performance and involve risks, uncertainties and other
    factors, including: the general economic and business conditions in the United
    States and Australia; trends and business conditions in the building and
    construction industries; the timing and amount of federal, state and local
    funding for infrastructure; competition from other suppliers in the industries
    in which Rinker operates; changes in Rinker’s strategies and plans regarding its
    ongoing business strategy, acquisitions, dispositions and business development;
    Rinker’s ability to efficiently integrate past and future acquisitions;
    compliance with, and potential changes to, governmental regulations related to
    the environment, employee safety and welfare and other matters related to
    Rinker; changes in interest rates, weather and other natural phenomena, energy
    costs, pension costs; healthcare costs; outcomes of legal hearings such as the
    Lake Belt challenge and other risks and uncertainties identified in our filings
    with the Australian Stock Exchange and the SEC. In light of the many risks and
    uncertainties surrounding the proposed offer by Cemex, Rinker can give no
    assurances that actual results would not differ materially from any forwardlooking
    statements contained in this communication. You are cautioned not ot
    place undue reliance on any forward-looking information. Rinker disclaims any
    intention or obligation to update or revise any forward-looking statements
    contained herein, whether as a result of new information, future events or
    For further information, please contact Debra Stirling on 61 2 9412 6680 or 0419 476 546
    (international + 61 419 476 546)
    30 October 2006 RIN 06-06

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