It is now less than five months since CIMIC lodged an unsolicited bid for Macmahon. That bid, at 14.5c, has failed and, with AMNT soon to be a 44% shareholder, CIMIC is more likely to be a seller than a buyer of the business.
We think Macmahon is worth around asset backing of around 15c per share but the joint venture with Indonesian miner AMNT introduce new risks which we fretted over in our last review.
The share price remains unchanged and is 3% higher since our Sell call. This has been a mildly successful recommendation, rising over 30% since being introduced as part of the mining services mini portfolio but we don’t think there is enough cause to continue coverage. Having already made the Sell call, it’s now time to CEASE COVERAGE.