Australian recruitment firm Skilled Group Ltd agreed to a A$422 million ($325 million) takeover offer from Programmed Maintenance Services Ltd after its smaller rival raised its initial proposal, sending its shares up sharply.
The deal will create a company with a market value of A$750 million and is one of largest in a wave of consolidation sweeping through Australia’s staffing industry.
Skilled Chairman Vickki McFadden said in a statement that the short term benefits of the deal were compelling and the combined firm would be a more diverse business with greater funding flexibility for acquisition opportunities.
Skilled agreed to a new offer from Programmed Maintenance of A$1.79 a share, up from A$1.38 proposed in December. Its shares rose 10 percent in early trade to A$1.70.
The deal is expected to close by mid-October and UBS AG was the adviser for Skilled.
Other recent deal announcements in the sector include Japan’s Recruit Holdings Co Ltd acquisitions of Australia’s Chandler Macleod Group Ltd and another staffing firm for A$360 million. ($1 = 1.2912 Australian dollars)