Boral (ASX:BLD) share price gains as Seven's hold surpasses 50%

It's a fight to the finish line as Seven Group inches closer to winning control of the construction supplies company.

| More on:
Two men and a woman in high vis gear on a Construction site

Image Source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

sdf

The Boral Limited (ASX: BLD) share price is climbing as Seven Group Holdings Ltd (ASX: SVW) gets tantalisingly close to winning its battle for control of the construction supplies company.

Right now, the Boral share price is trading at $7.38, 0.41% higher than its previous closing price.

At the same time, shares in Seven Group have boosted 2% higher to trade at $23.31.

While Seven Group doesn't yet have full voting power, it now holds a majority stake in Boral.

Let's take a closer look at today's news in the battle for Boral.

Seven Group's takeover comes to fruition

The Boral share price is lifting despite Seven Group being only a hair's breadth away from gaining control of the company.

According to the announcement from Seven Group, it currently holds 52.65% of all of Boral's outstanding shares.

But, in this case, that doesn't give it majority voting power as 3.33% of Seven Group's Boral shares are part of an equity swap transaction.

Therefore, it only holds 49.32% of Boral's voting power.

As The Motley Fool reported yesterday, if Seven Group's voting power in Boral surpasses 50%, the takeover bid will be extended for another fortnight.

It's now a race against time for Seven Group to get a hold of an additional 0.68% of Boral's outstanding shares before 7pm today when the takeover bid closes.

Seven Group is confident it will secure 50% of Boral's voting power before the cut off. However, the pressure doesn't seem to be damaging the Boral share price.

What next?

Seven Group has stated, if it wins control, it plans to retain a majority of independent directors on Boral's board. In today's release, it said:

Having a majority of independent directors has been an important feature of SGH's corporate governance for many years, helping to drive value for the benefit of all SGH shareholders, and it looks forward to following the same approach for Boral.

According to reporting by the Australian Financial Review today, Seven Group will also request a number of changes.

These include creating additional board seats, speeding up Boral's overhaul of its Australian business, and pushing for increased discipline in the company's capital management.

The Australian has reported, if Seven Group wins control of Boral, it will instate its CEO Ryan Stokes as Boral's chair, replacing Kathryn Fagg. Additionally, Seven Group's chief financial officer Richard Richards will be put back onto Boral's board.

Boral share price snapshot

This year has been a good one for the Boral share price. It has gained 48% year to date and is 95% higher than it was this time last year.

And Seven Group

Despite pushing higher today, the Seven Group share price is still 2.7% lower than it was at the beginning of 2021.

However, it has gained 32% since this time last year.  

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Mergers & Acquisitions

Man with rocket wings which have flames coming out of them.
Mergers & Acquisitions

Guess which ASX stock is up 50% on takeover offer

A takeover offer is getting investors excited this morning. Let's dig deeper into things.

Read more »

An oil worker in front of a pumpjack using a tablet PC.
Energy Shares

Santos shares rocket on $30b takeover offer

This energy giant could be going private after receiving a takeover approach.

Read more »

a woman drawing image on wall of big fish about to eat a small fish
Mergers & Acquisitions

Guess which ASX 300 share just received a takeover offer

This share is jumping today after receiving a takeover offer.

Read more »

A man sits in a chair hunched over a laptop and covered head to toe in frozen icicles to represent Envirosuite's trading halt
Mergers & Acquisitions

Johns Lyng Group shares enter trading halt. Is it a takeover target?

This ASX 200 stock looks ripe for a takeover.

Read more »

Group of people in a gym high five each other surrounded by gym equipment.
Mergers & Acquisitions

This ASX tech stock is hitting a record high on acquisition news

The market is responding positively to this news. Let's dig deeper into it.

Read more »

Two people shaking hands in the boardroom on a merger.
Mergers & Acquisitions

What did Macquarie make of the Brickworks and Soul Patts merger?

Macquarie sees simplification, scale, and upside… but it also has a warning..

Read more »

A cool young man walking in a laneway holding a takeaway coffee in one hand and his phone in the other reacts with surprise as he reads the latest news on his mobile phone
Mergers & Acquisitions

PointsBet share price surges 11% on improved takeover offer

The bidding war for PointsBet shares continues apace today.

Read more »

A couple sit in front of a laptop reading ASX shares news articles and learning about ASX 200 bargain buys
Share Gainers

Why are Soul Patts shares up 9% today?

A marriage proposal has seen investors flock to this company.

Read more »