May 11 (Reuters) - Australia’s Boral Ltd on Tuesday urged shareholders to reject a nil-premium takeover offer from diversified Australian investor Seven Group Holdings, saying it undervalued the construction materials maker.
Seven Group, which has been increasing its stake in Boral over the past 14 months, on Monday offered to buy shares it does not already own in Boral for A$6.50 per share, valuing the target company at A$7.91 billion ($6.20 billion).
A committee formed by Boral to review the offer found the bid was “opportunistic” and undervalued the company, and unanimously recommended shareholders reject it.
Boral has benefited from a rebound in the housing market and has been overhauling its operations as it looks to exit the United States and retreat from its seven-year global expansion strategy.
Boral’s management “remain committed to the company’s strategic goals including... the ongoing process in relation to its North American portfolio,” it said. ($1 = 1.2689 Australian dollars) (Reporting by Harish Sridharan in Bengaluru; Editing by Lincoln Feast.)