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Fletcher Building shares surged yesterday after news that a Canadian firm had made a takeover approach for Australian construction and property giant Multiplex Group.
Fletcher shares rose 22c to $11.60, before closing up 15c at $11.55 - matching last week's record closing high.
Multiplex said Brookfield Asset Management had made an approach for "100 per cent of the underlying businesses of Multiplex" - the firm behind the much-delayed Wembley sports stadium in London.
That would encompass Multiplex's property development, construction, property-funds management and facilities-management businesses.
Fletcher Building has long been considered a possible takeover target and was boosted last October by a US$12 billion ($17.6 billion) bid for Australia's Rinker Group by Cemex, the world's number three cement maker.
Forsyth Barr's head of research Rob Mercer said corporate activity had thrown the spotlight on to the building sector.
"As corporate action makes people aware of potential undervaluing on the market, the building sector is still the sector that looks good value for corporate attention."
But he said any interest in Fletcher Building would be due more to the company's strong performance.
"Compared to other New Zealand companies it's on the [takeover] radar, but then corporate interest in Fletcher Building is always justified. It should be on the radar anyway."
News of an approach for Multiplex came on January 25, when the group announced it had received a potential bid. Yesterday it named the bidder as Brookfield but said no value had yet been put on the offer. Multiplex has a market capitalisation of A$4.04 billion.
Shares in Multiplex were up 7.5 per cent at A$4.89 ($5.53) during trading yesterday.
Cemex has extended its bid for Rinker until March 30.
- STAFF REPORTER, AGENCIES
