US suitor Wildcat Infrastructure lobs $1.9 billion offer for Austal, trumping bid from South Korea’s Hanwha
Little-known Wildcat Infrastructure has bettered South Korean conglomerate Hanwha’s offer of between $US1.05b to $US1.2b.
Austal appears likely to open its books to a second bidder after US investment firm Wildcat Infrastructure underlined its interest in the naval shipbuilder with a $1.9 billion takeover proposal for its US shipyard.
The non-binding offer puts the little-known bidder in competition with South Korean conglomerate Hanwha, which lobbed a bid for Austal USA last month after pursuing its ASX-listed parent for two years.
Austal confirmed to the ASX on Wednesday that the offer by a Wildcat-led consortium valued its US business at between $US1.25 billion and $US1.35b ($1.87b), bettering Hanwha’s offer of $US1.05b to $US1.2b.
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By continuing you agree to our Terms and Privacy Policy.“Wildcat has indicated it intends to operate (Austal USA) as a standalone platform, retaining the Austal brand and the company’s US operations,” Austal said.
“The board and its advisers will consider the transaction proposed by Wildcat.”
However, it is likely the US group will also be granted approval to conduct due diligence over the US business, which is anchored by a shipyard in Mobile in Alabama that is supported by manufacturing contracts with the US Navy and the US Coastguard.
Shares in Austal leapt 5.6 per cent to $4.60 in early trading after the announcement to value the group at $1.94b.
Wildcat’s intervention has jolted Hanwha, a near 20 per cent shareholder in Austal that desperately wants the Mobile shipyard to help expand its influence in US naval shipbuilding.
Austal agreed to consider Hanwha’s proposal for the facility after messaging from the Trump Administration that suggested it would prefer South Korean ownership of the Mobile yard.
However, there is now a sense that the US Government could look more favourably towards an American-owned business acquiring Austal USA.
Mr Gregg last week insisted there was “great momentum” behind Hanwha’s proposal.
If an offer was successful, it would deprive the Andrew and Nicola Forrest-backed Austal of its dominant profit earner but give the company a war chest to support a pivot back to Australia where it will share in tens of billions of dollars in new defence contracts over the next 20 years as the country’s government-appointed strategic shipbuilder.
With any sale subject to shareholder approval, the Forrests’ 19.3 per cent stake in Austal — held through their private investment company Tattarang — could determine the fate of a takeover proposal.
Hanwha, which was given Australian approval last year to increase its stake in Austal to 19.9 per cent, has already invested in manufacturing capacity in the US, but buying the 66ha Mobile yard would give it access to Pentagon shipbuilding programs for warships and submarines.
