Ferrovial Services, a subsidiary of Spain's Ferrovial, has ceased discussions with Transfield Services regarding an acquisition of 100% of the company.
Ferrovial Services has undertaken the limited due diligence available and concluded that there were a number of issues that impacted value.
In order to seek a Board recommendation, Ferrovial Services took a very long term view on value and proposed a revised price of A$2.00 per share, which has been rejected by the Board and therefore discussions have ceased.
Chairman Transfield Services Diane Smith-Gander said in a statement on Monday:
"The board of Transfield has considered Ferrovial's proposal with the company's advisers and has formed the view that the new price of $2.00 per share still does not reflect the underlying value of Transfield Services shares."
Ferrovial Services is a disciplined investor and will continue to investigate options to grow its business internationally.
Ferrovial Services provides solutions in urban and environmental services and in the maintenance of infrastructures and facilities. Their integral asset management system encompasses the entire service life cycle: from planning to operation and maintenance.
Ferrovial's subsidiary Ferrovial Airports, in a 50:50 consortium with Macquarie European Infrastructure Fund 4 (MEIF4), has recently completed the acquisition of the UK Aberdeen, Glasgow and Southampton airports from Heathrow Airport. The transaction has an enterprise value of GBP1,048 million (US$1,637 million).