history doesn't show a background of successful acquisitions from this company.
i got the impression they were going to stick to the knitting and focus on the core business.
a little bit more soul searching perhaps before on the acq trail again?
it says they need Commerce Commission approval but I thought FBU ditched their Steel division.
the FBU June 2018 Annual report has 7 divisions with steel being one of these. The STU takeover if it occurs would basically double the size of the FBU steel division so that it is no longer the smallest FBU division (by revenue).
FBU Steel had revenue of $532m and operating earnings of $41m (before a share of corporate costs, interest or tax) in the year to June 2018. It was FBU's fastest growing division in 2018 (by revenue) @ +8% from $491m of revenue in 2017.
STU had revenue of $496m, down from $511.4m in the prior year. As we know STU posted a loss but is expecting circa $25m EBIT in 2019 and is targeting to returning to an EBIT of $40m. This is pretty similar to what FBU achieves on its steel division.
Sounds like a sinking ship buying a sinking ship to me ...
I was a bit surprised by this. I would have thought all hands would have been on steering current sinking ship out of troubled waters. Not throwing a line to another. Our seas might start to look liker Pearl Harbour before too long.
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Originally Posted by peat
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