Siemens not planning to make offer for Renishaw

3rd Apr 2024 07:55

(Sharecast News) - German engineering firm Siemens confirmed late on Tuesday that it does not intend to make an offer for London-listed Renishaw.

The statement from Siemens came after markets blog Betaville suggested in an 'uncooked alert' that Renishaw was at the centre of takeover speculation.

Some people following the situation said the company interested in buying Renishaw was "one of the largest industrial conglomerates in Europe," Betaville said.

It cited sources as saying that the European business was rumoured to be working with an American investment bank on the potential acquisition.

Three years ago Renishaw ran a sale process to see if it could find an appropriate buyer after the company's founders and largest shareholders, Sir David McMurty and John Deer, indicated they would be open to selling their shareholdings to an appropriate buyer.

However, in 2021 the sale process was called off after the board, McMurty and Deer decided against selling the company to any of the businesses that had indicated an interest in buying Renishaw.

At 0910 BST, Renishaw shares were down 3.5% at 4,200p.

Russ Mould, investment director at AJ Bell, said: "While Siemens may have poured cold water on speculation that it wants to buy precision engineer Renishaw, the latter still remains a prime takeover candidate.

"Renishaw ticks the right boxes to be a bid target. It has specialist skills and a long track record of generating value for stakeholders. Its fortunes are heavily tied to the semiconductor industry where the prospects are improving after a year of oversupply. Furthermore, 52.8% of the company is owned by Renishaw's co-founders David McMurtry and John Deer, both of whom are in their 80s and want to sell down their positions.

"Three years ago, they put the company up for sale on the condition they would only sell to someone who respected the heritage and culture of the business. Reports suggested there were plenty of interested parties but keeping things 'the Renishaw way' might have been a hurdle that many didn't want to clear. Perhaps there needs to be a degree of flexibility on this front if they want a deal to succeed."