The Singapore contractor behind a competing bid for Macmahon Holdings' construction business has released emails it says back up its claims that Macmahon misled shareholders about the offer.
Indian-owned Sembawang Constructors and Engineers has threatened to take legal action against Macmahon over its deal last month to offload most of the troubled business to biggest shareholder Leighton Holdings for about $20 million.
While Sembawang first expressed interest to Macmahon about buying the unit in November, the WA company on Tuesday told the sharemarket the only proposal it had received from Sembawang came on January 3 - 10 days after it signed the Leighton deal.
Sembawang chief executive Richard Grosvenor described the ASX announcement as misleading and deceptive. "Regrettably, Sembawang are now compelled to take a hostile position to get to the truth of the Leighton-Macmahon transaction," Mr Grosvenor said.
Lawyers for the Singapore company have sent Macmahon's board a six-page letter reminding them of their fiduciary duty to consider rival offers. No legal action has yet been taken.
Sembawang has offered to buy the construction unit as a whole without naming a price, or to match Leighton's deal to acquire most of its projects at the higher price of $25 million.
Mr Grosvenor made public an email exchange between himself and Macmahon managing director Ross Carroll, including a November 26 message saying Sembawang "would be happy to consider purchasing" the business.
A December 7 reply from Mr Carroll was omitted from the released email chain. In that email, Mr Carroll said Macmahon would not be able to do a deal with Sembawang. The proposed Leighton agreement was announced the following week.Mr Grosvenor's next email came on Christmas Day - a day after the Leighton deal was finalised - suggesting Macmahon should have notified the market of the November 26 offer. Macmahon had to act fast to tie up the construction deal and an $80 million capital raising to avoid breaching its debt covenants. It was tipped to lose up to $100 million on two Pilbara rail projects and a South Australian road project. The success of the raising is understood to have been dependent on Macmahon transitioning to a mining-only contractor.
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