Germany's ATM Holding has bought a 25% shareholding in Murray and Roberts (M&R), making the European company the largest shareholder in the engineering and construction group. Owned by private investment holding company Aton GmbH, which invests in the mining, engineering, aviation and health technology sectors, ATM Holding has not announced its intentions with this purchase.
In a statement issued by M&R, the company said it will engage with ATON regarding its intentions. “We don't know what their intentions are at this stage - all we know is that they own 25% of the company,” Ed Jardim, head of investment at M&R told Reuters.
Aton first invested in M&R in 2015 with the purchase of 4.49% of the company. It has become the largest shareholder as a result of major shareholders reducing their interest in M&R. Coronation Fund Managers sold its 15% stake while Allan Gray and Sanlam Investment Management sold a portion of their shares.
Bloomberg reported rumours of the Aton investment prior to the announcement, citing confidential sources as stating that the company was exploring combining M&R with its own mining industry service provider, J.S. Redpath Holding. Aton had held discussions with M&R regarding a potential merger of J.S. Redpath Holding with M&R's underground mining business between September 2015 and April 2016, but an agreement could not be reached on the deal's structure and value.
Shares in M&R fell 0.20% to R14.98 after the firm said diluted continuing headline earnings per share for the six months ended December 2016 slumped to 27 cents from 93 cents in 2015 due to underperformance in its Oil & Gas division. The company, which sold its infrastructure business in 2016, said revenue from its oil & gas division declined to R3 billion rand from R6.1 billion following the significant drop in oil prices in 2014 and expenditure cut backs from oil clients. The order book from continuing operations decreased to R24.5 billion rand, while group revenue fell 18% to R10.7 billion.
However, following the Aton announcement, shares in M&R were up 2% at R1531. Shares in rival Group Five fell 2.9% after its chief executive announced his departure and it reported its first six-month loss in 11 years.