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SYDNEY - Australia's top sugar producer CSR Ltd. said it was not aware of any bid for the company, sending its shares into retreat after they surged more than 9 per cent on market talk of a private equity takeover.
"We are not aware of any impending takeover bid for the company," CSR said in a statement to the stock exchange.
The stock had risen as much as 9.2 per cent to A$4.02 ($4.57) on talk of an offer at A$4.30 per share as soon as Wednesday afternoon, but by 0105 GMT had pulled back to A$3.79.
Private equity funds stepped up their investments in the Australian market last year, chasing under-performing companies and those with low debts, with more bids expected this year.
CSR, which also makes aluminium, bricks and roof tiles, has been talked about as an attractive candidate for private equity investors.
"There is potential there for (a bid) to happen because it has various assets. It potentially is a candidate," said Robert Hook, a fund manager with SG Hiscock & Co.
CSR Chief Executive Alec Brennan said in November that the feverish level of private equity activity in Australia could spur a break-up, although it was not the right time to sell.
He said then that CSR was constantly looking at opportunities to sell off parts of the company to improve value to shareholders, as it did when it spun off its heavy building materials arm as Rinker Group Ltd.
Rinker is now the subject of a US$12 billion ($17.5 billion) takeover offer from Mexican cement giant Cemex.
Australian was the most targeted country last year by buyout firms in Asia-Pacific region, with value of announced deals totalling US$20.6 billion, according to data compiler Dealogic.
A Kohlberg Kravis Roberts-led consortium's bid for Coles Group Ltd was rebuffed by the company last year, but Qantas Airways Ltd board has recommended a A$11.1 billion bid by a consortium including Macquarie Bank Ltd.
- REUTERS
