Manitowoc ups bid for Enodis

Milwaukee Journal Sentinel/Associated Press

The bidding war for British cooking equipment supplier Enodis PLC heated up today, as Manitowoc Co. (MTW) came back with a second offer to trump an approach by another U.S. company, Illinois Tool Works Inc. (ITW).

Manitowoc raised its offer to 296 pence ($5.79) per share, valuing Enodis at 1.08 billion pounds ($2.1 billion). ITW had offered $2 billion.

Enodis had no immediate comment, but investors appeared to expect even higher bids.

Shares in the company, which supplies fryer systems to restaurants and retailers, including McDonald’s Corp. (MCD) and Wal–Mart Stores Inc. (WMT), rose 2.4 percent to 305.25 pence ($5.97) today.

Manitowoc, which makes cranes, marine, and food service equipment and is the biggest ice machine maker in the United States, opened the bidding on Enodis in April when it made an offer of 260 pence ($5.09) per share, which was accepted by the British company.

However, Enodis changed allegiance when Illinois Tool Works, a Glenview, Ill.-based manufacturer of engineered products with more than 800 business units in 49 countries, made a sweetened 282 pence bid, or about $2 billion, earlier this month.

Both of the suitors are including a 2 pence (4 cents) a share dividend as part of their bids.

Manitowoc said its offer was more than double Enodis’ share price on April 8, the day before it made its first approach and called on Enodis to recommend its new offer.

Illinois Tool Works said it noted the increased offer and was “considering its position with respect to Enodis and will make an announcement in due course.’

An Enodis–Manitowoc combination would give Manitowoc entry into two major new market segments — hot food service and food retail equipment. A successful purchase by Illinois Tool would nearly double that U.S. company’s food equipment business and make the combined food equipment business nearly a fifth of its total revenues.

Enodis, which has a range of food-service products includes cooking equipment, refrigeration units, and ice and beverage dispensing equipment that are used in fast-food restaurants, institutions, grocery stores and supermarkets, has successfully fought off a series of takeover bids over the past two years.

The company, which has manufacturing facilities in North America, Europe and Asia, and employs 6,800 workers, last week reported a profit of 9.7 million pounds ($19 million) for the six months ending March 29, compared with 17.3 million pounds in the comparable period a year ago. It attributed the drop in profit to the cost of restructuring.