Siemens AG is confident a renewed offer on Monday for Austrian engineering company VA Technologie AG will succeed, two months after political opposition killed a previous bid.
The German engineering conglomerate said it would offer 55 euros per share to all outstanding shareholders, valuing the company at 825 million euros ($1.1 billion), after it had bought a holding of around 16 percent.
The offer was at a premium to a 51 euro closing price for VA Tech shares on Friday. The shares were up 8.5 percent to 55.33 euros at 1312 GMT following an early-morning suspension.
Siemens dropped previous take-over plans in September after Austria's centre-right government said it viewed its bid as hostile.
Siemens executives said they believed their second bid - which they hope will strengthen Siemens' position in power transmission and distribution and give it better access to Asian and Francophone markets - would succeed.
"We are confident they will sell," Chief Financial Officer Heinz-Joachim Neubuerger said of Austria's state privatisation agency OeIAG, which holds 15 percent of VA Tech.
"I think there was a reaction at that time," Siemens Chief Executive Heinrich von Pierer said of the original offer. "In the meantime there were opportunities to talk and exchange ideas. Public opinion changed."
Neubuerger added that Siemens had not offered any job guarantees to sweeten the bid.
Initial reaction to the new bid was muted. Chancellor Wolfgang Schuessel said Siemens would be a "responsible owner". There was no immediate repeat of earlier protests from politicians, VA Tech management and unions that a sale to Siemens would cost thousands of jobs.
"There have been constructive talks" with Siemens, said a spokeswoman for OeIAG.
The agency said it would examine the Siemens bid to see if it met criteria for protecting Austrian interests laid down by government privatisation policy, including protection against plant sites being closed.
Siemens acted in part because major US rival General Electric Co wants to expand in Europe, said Albert Hochleitner, the head of Siemens Austria.
"There was a threat in the form of interest from GE that was really a threat for us," Hochleitner told reporters.
At Siemens' offer price, the remaining shares would fetch close to 700 million euros, according to Reuters calculations. Outside of the stakes held by OeIAG and Siemens, the other shares are in free float.
The chief executive of VA Tech declined to comment on the new offer. "We would be well advised not to make any comment for the time being," Klaus Sernetz told reporters. Siemens Austria executives said they would meet the top executives of VA Tech later on Monday.
Austria's take-over commission said it expected Siemens to seek approval for the bid later on Monday, and the commission's head said the body would decide quickly.
Neubuerger said Siemens could start a tender offer for VA Tech shares in January, and Hochleitner said VA Tech would be delisted from the Vienna bourse if the bid were successful.
Siemens has said it is interested in VA Tech's power transmission and distribution business, metallurgy and engineering services. The Austrian firm also makes equipment for hydro-power and water treatment plants.
"In terms of a commercial strategy, the planned acquisition could make sense," analyst Roland Pitz of HVB bank wrote in a research note.
"Against the price/sales valuation 2004 the possible deal volume would be in line with the volume of recent Siemens deals," he added.