British ports and ferries group P&O agreed to a $5.69 billion takeover bid from Gulf-state backed Dubai Ports World today.
In a deal that creates one of the world's largest shipping companies, P&O said Dubai Ports had offered 443p per share in an all-cash bid for the 165-year-old British company. The offer was at the top end of market expectations.
The deal follows a string of recent takeovers of major British companies and a wave of consolidation by European port operators.
Dubai Ports World, created by the merger of two state-owned entities in September, said it would retain P&O's management and keep the group headquartered in London.
The offer price was a 46 per cent premium to P&O's trading price before October 30th when P&O confirmed it had been approached by a potential bidder.
P&O shares, which jumped more than 30 per cent at the time on talk that the approach could spark a bidding war, closed yesterday at 435pence.
Denmark's Moeller-Maersk, Singapore government investment agency Temasek Holdings and Hong Kong's Hutchison Whampoa had been named as potential counter bidders for P&O, but no rival bids have emerged so far.
P&O agreed to pay Dubai Ports a £34 million "inducement fee" in the event of a third party making a successful rival bid under the deal.
P&O earns about 80 per cent of its profits from ports in Asia, the Americas and Europe. The company is the world's fourth-largest ports group, and its iconic brand-name still appears on cruise ship operations it no longer owns.
Dubai Ports is one of several Dubai-government linked firms scouring the globe for assets in which to invest the Gulf emirate's mountain of oil cash. Dubai Ports' expansion has made it one of the largest ports operators in the world.