By Paola Arosio
MILAN, Jan 5 (Reuters) - Italian cablemaker Prysmian aims to launch its 830 million euro cash-and-stock bid for Dutch peer Draka on Thursday as it rushes to pre-empt a higher all-cash offer plan from China's Xinmao.
Sources close to the deal told Reuters that Prysmian had won regulatory approval and was poised to run its offer from Jan. 6 for four weeks in an effort to overtake French group Nexans as the world's top cablemaker.
Xinmao is racing to get the necessary approvals from Chinese authorities to launch its bid in time to win over shareholders. It says it has the financing it needs in place, although Draka has questioned this.
'(Prysmian) is finalising the details to be able to launch the offer tomorrow,' one of the sources said on Wednesday.
A second source added that the Italian company had got the green light from Dutch and Italian regulators to proceed.
Prysmian, the world's No.2 maker of cables, declined to comment. The Italian company unveiled its friendly takeover plan for Draka on Nov. 22.
But its plan met an immediate hurdle when Xinmao gatecrashed the agreed deal and said it would offer 1 billion euros ($1.3 billion) in cash for Draka.
Shares in Prysmian were flat at 12.86 euros at 1250 GMT, outperforming the STOXX Europe 600 industrial goods and services index, which was down 1.9 percent. Meanwhile Draka shares were trading at 19.32 euros, above Prysmian's bid price but below Xinmao's expected offer price of 20.5 euros a share.
HEADSTART
Approval from the Dutch market regulator AFM and Italian regulator Consob for its offer will give Prysmian a headstart in the race to secure Draka, which is a leader in optical fibre in Europe and China.
However, the agreed takeover of Draka could fail if Xinmao manages to formalise its own offer before the Italian bid ends. Xinmao has said it will submit its bid by Feb. 14.
Draka's management has endorsed Prysmian's offer and has remained sceptical of Xinmao's takeover plans.
Prysmian has also lobbied the European Union on fears Europe could lose cable know-how to China if Xinmao buys Draka.
Dutch media said in December that activist Draka investor Centaurus was pushing the Dutch cablemaker to consider Xinmao's bid.
But key to winning control of Draka will be the backing of its biggest investor Flint Beheer, a family-controlled fund which has a 48.5 percent stake in the Dutch company.
A Dutch trade union and Draka's works council backed Prysmian's bid on Tuesday. Under Dutch takeover law, the works council has the right to offer advice over a proposed offer.
The FNV union said it still needed to enter into agreements with Xinmao, and that both the works council and the union wanted to meet with Xinmao in the short term.
(Writing by Lisa Jucca; editing by Alexander Smith) ($1=.7530 Euro) Keywords: DRAKA/PRYSMIAN (elisabetta.jucca@thomsonreuters.com; +39 02 66129 442; Reuters messaging: elisabetta.jucca.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2011. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
MILAN, Jan 5 (Reuters) - Italian cablemaker Prysmian aims to launch its 830 million euro cash-and-stock bid for Dutch peer Draka on Thursday as it rushes to pre-empt a higher all-cash offer plan from China's Xinmao.
Sources close to the deal told Reuters that Prysmian had won regulatory approval and was poised to run its offer from Jan. 6 for four weeks in an effort to overtake French group Nexans as the world's top cablemaker.
Xinmao is racing to get the necessary approvals from Chinese authorities to launch its bid in time to win over shareholders. It says it has the financing it needs in place, although Draka has questioned this.
'(Prysmian) is finalising the details to be able to launch the offer tomorrow,' one of the sources said on Wednesday.
A second source added that the Italian company had got the green light from Dutch and Italian regulators to proceed.
Prysmian, the world's No.2 maker of cables, declined to comment. The Italian company unveiled its friendly takeover plan for Draka on Nov. 22.
But its plan met an immediate hurdle when Xinmao gatecrashed the agreed deal and said it would offer 1 billion euros ($1.3 billion) in cash for Draka.
Shares in Prysmian were flat at 12.86 euros at 1250 GMT, outperforming the STOXX Europe 600 industrial goods and services index, which was down 1.9 percent. Meanwhile Draka shares were trading at 19.32 euros, above Prysmian's bid price but below Xinmao's expected offer price of 20.5 euros a share.
HEADSTART
Approval from the Dutch market regulator AFM and Italian regulator Consob for its offer will give Prysmian a headstart in the race to secure Draka, which is a leader in optical fibre in Europe and China.
However, the agreed takeover of Draka could fail if Xinmao manages to formalise its own offer before the Italian bid ends. Xinmao has said it will submit its bid by Feb. 14.
Draka's management has endorsed Prysmian's offer and has remained sceptical of Xinmao's takeover plans.
Prysmian has also lobbied the European Union on fears Europe could lose cable know-how to China if Xinmao buys Draka.
Dutch media said in December that activist Draka investor Centaurus was pushing the Dutch cablemaker to consider Xinmao's bid.
But key to winning control of Draka will be the backing of its biggest investor Flint Beheer, a family-controlled fund which has a 48.5 percent stake in the Dutch company.
A Dutch trade union and Draka's works council backed Prysmian's bid on Tuesday. Under Dutch takeover law, the works council has the right to offer advice over a proposed offer.
The FNV union said it still needed to enter into agreements with Xinmao, and that both the works council and the union wanted to meet with Xinmao in the short term.
(Writing by Lisa Jucca; editing by Alexander Smith) ($1=.7530 Euro) Keywords: DRAKA/PRYSMIAN (elisabetta.jucca@thomsonreuters.com; +39 02 66129 442; Reuters messaging: elisabetta.jucca.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2011. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.