(Reuters) – Private equity firm Nordic Capital raised its bid for Swedish engineer Munters (MTRS.ST: Quote, Profile, Research, Stock Buzz) to 5.7 billion Swedish crowns ($859 million), retaking the lead in a bid battle investors were betting has not yet ended.
Munters shares were up 2.6 percent to 78.75 crowns at 1140 GMT on Wednesday, above the 77 crowns offered by Cidron, Nordic Capital’s bid vehicle. Munters recommended the new offer.
The fight to win ownership of Munters started on Sept. 6 when Swedish engineer Alfa Laval (ALFA.ST: Quote, Profile, Research, Stock Buzz) offered 68 crowns as it aimed to add climate control technology to its product range.
Nordic Capital entered the fray on Sept. 29, saying it was attracted by Munters as a high-growth quality company with strong competitive positions. It offered 73 crowns, a level Alfa Laval trumped on Oct. 1 with a recommended bid at 75 crowns.
“If you want to get the whole company, you have to go up another notch,” said Mats Liss, analyst at Swedbank. A second analyst said the chance of a counterbid by Alfa Laval was low.
Cidron said its offer was a 47 percent premium to Munters share price on Sept. 3, the business day before Alfa Laval launched its offer, adding it had the irrevocable backing of 10.3 per cent of shareholders provided no competing offer was announced at a price over 82.50 crowns.
Shareholders representing an additional 32.6 percent of Munters have said they will tender their shares to Cidron, if there was no higher offer.
The bid is conditional on Cidron getting more than 50 per cent of Munters’ shares.
Nordic Capital had said on Sunday it was considering its options after approaching institutional shareholders in support of a 77 crown bid. It did not get the 50 percent support it was looking for at that time.
Two major owners — AB Industrivarden (INDUa.ST: Quote, Profile, Research, Stock Buzz) and Latour, (LATOb.ST: Quote, Profile, Research, Stock Buzz) which hold nearly 30 percent of Munters stock, — agreed to back Alfa Laval’s offer unless another party offered at least 78.75 crowns.
Shareholders have until Oct 26 to accept Cidron’s new bid.
By Sven Nordenstam and Victoria Klesty
(Editing by Michael Shields and Dan Lalor) ($1 = 6.638 Swedish crowns)