Leighton CEO Steps Down as Hochtief Raises Bid

SYDNEY--The chief executive of Leighton Holdings Ltd.(LEI.AU) left the company after negotiations between its independent directors and majority shareholder Hochtief AG (HOT.XE) resulted in a sweetened bid for a bigger stake in the Australian contractor.

Germany's Hochtief said it would now offer around 1.21 billion Australian dollars (US$1.09 billion), or A$22.50 a share, for three out of every eight shares held by Leighton's minority shareholders. That is up from A$22.15 a share earlier this week.

Hochtief, controlled by Spanish builder Actividades de Construccion y Servicios SA (ACS.MC), declined to make an offer to acquire the company as a whole as requested by Leighton's independent directors.

Leighton said Chief Executive Hamish Tyrwhitt and Chief Financial Officer Peter Gregg would stand down immediately, at the request of Hochtief. The German company's Chief Executive, Marcelino Fernandez Verdes, will succeed Mr. Tyrwhitt, it said.

The latest bid would increase Hochtief's stake in Australia's biggest construction company to as much as 73.82% from 58.77% now.

"The improved offer is the outcome of negotiations between Hochtief and an independent board committee consisting of all Leighton's independent nonexecutive directors," the company said in a statement to the Australian Securities Exchange.

The independent directors--Robert Humphris, Paula Dwyer, Russell Higgins, Michael Hutchinson and Vickki McFadden--pressed Hochtief to offer to buy all the company's shares but Hochtief declined to do so, it said.

Write to Rhiannon Hoyle at [e-mail]

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