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Last Updated: Thursday, 26 January 2006, 21:06 GMT
Dubai firm raises stake for P&O
P&O ferry

A bidding war for ports and ferries operator P&O has broken out with Dubai Ports World trumping a 3.5bn ($6.3bn) takeover bid for the group.

P&O has agreed to the 520 pence a share bid, withdrawing support for a 470p a share offer made by PSA International.

PSA is owned by Temasek Holdings, a Singapore government investment agency which already owns 4.1% of P&O.

Speculation of a bidding war for P&O has been rife since DP World launched its takeover bid last year.

Premium price

In a statement P&O said the latest, improved offer from DP World represented a 71.3% premium of its closing price on 27 October - the last day before market rumours of a possible bid for the firm emerged.

It added the bid - which its board has unanimously recommended to shareholders - was also 10.6% higher than the offer made by PSA.

Founded in 1837, P&O has three divisions - ferries, ports and logistics.

In its heyday in the mid-1920s, it owned a fleet of almost 500 ships before transforming itself in the post-war era to concentrate more on cargo shipping and ports.

DP World is one of several Dubai government-linked firms looking for assets to invest in, backed by huge cash piles from the Gulf emirate's resources.

Ports are currently reaping the rewards of an expansion in world trade, as goods made in Asia find their way to the US and Europe.

Meanwhile, PSA had earlier said that taking over P&O would give the enlarged group the financial strength and global presence to compete effectively against rival port operators.




SEE ALSO:
P&O backs Singapore takeover bid
26 Jan 06 |  Business
P&O receives further takeover bid
10 Jan 06 |  Business
Bid talk sends P&O shares higher
02 Dec 05 |  Business
P&O agrees bid from Dubai Ports
29 Nov 05 |  Business
P&O jumps on hope of bidding war
31 Oct 05 |  Business
P&O 'on track' to improve profits
11 Aug 05 |  Business


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