Shares in Steel & Tube have jumped 27% after its majority owner, OneSteel made a $175 million takeover offer.
The Australian steelmaker is offering $4 per share for the remaining 49% it does not already own - a 33% premium on Friday's closing price.
Steel and Tube's profit plunged by a fifth last year, but analysts say the compaNY will benefit from the falling New Zealand dollar, high steel prices and a large pipeline of major construction projects.
OneSteel chief executive Geoff Plummer says it's an attractive offer given the lack of trading in Steel & Tube's shares and the current economic uncertainty and market turmoil.
Steel & Tube has 8000 shareholders, with ACC being the second-largest investor, holding just over 1%.
If the offer is successful, OneSteel chief executive Geoff Plummer says it will allow OneSteel to cut corporate costs, including delisting from the NZX.
He says Steel & Tube will benefit from being part of a bigger operation.
The deal is conditional on the support of 90% of shareholders, and approval from the Overseas Investment Office.
Steel & Tube shares jumped 86 cents to $3.86 on Monday following the offer.
