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There has been no shortage of interest in catering equipment maker Enodis: the catering equipment maker turned down bids in 2006 from US rivals Manitowoc and Middleby, as well as Aga Foodservice. But, persistance may finally have paid off for Manitowoc, as it is back with a 260p per share indicative offer for Enodis - and it seems this time around management might bite as they have agreed to open the group's books to Manitowoc.
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Shares in Enodis surged 52 per cent to 230p on the news, before settling back a little. Michael Blogg, an analyst at Arbuthnot Securities, says the price on offer should be seen as a 'knock-out blow', in the likely absence of an auction developing. The 260p a share includes 2p in lieu of the Enodis interim dividend and represents 19.7 times Arbuthnot's adjusted EPS estimate for September 2008.
Enodis's shares have been in the doldrums of late, and were trading at just 151p before it revealed Manitowoc's offer. This could provide an attractive exit for investors, who should sit tight at 226p.
Last IC View: Good value, 180.5p, 21 Nov 2007
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