Vesuvius Reviews RHI Magnesita Takeover Proposal Valuing Shares at 551 Pence
Vesuvius is evaluating an unsolicited cash-and-share takeover proposal from RHI Magnesita valued at 551 pence per share. The transaction would give Vesuvius shareholders about 13% of the combined refractory-materials group, but no firm offer has been announced.
Cash-and-share proposal lifts Vesuvius stock
Vesuvius is reviewing an unsolicited takeover proposal from RHI Magnesita that values the British refractory-products supplier at 551 pence per share. According to ADVFN, Vesuvius shares rose as much as 23% on Tuesday after the company confirmed that it was considering the approach.
The proposed consideration comprises 470 pence in cash and 0.28 new RHI Magnesita shares for every 10 Vesuvius shares. The value assigned to the equity portion is based on RHI Magnesita's volume-weighted average share price during the month ending August 27, when the proposal was submitted.
Under the proposed terms, Vesuvius shareholders would receive approximately 7.1 million newly issued RHI Magnesita shares and own about 13% of the combined company. They would also retain Vesuvius's declared interim dividend of 7.1 pence per share without any reduction in the offer value.
Board examines terms and execution risks
Vesuvius said its board was assessing the proposal with financial and legal advisers, including the transaction terms and execution risks. The company stressed that there was no certainty that RHI Magnesita would make a firm offer and advised shareholders to take no action.
Cevian Capital, Vesuvius's largest shareholder, gave an irrevocable undertaking on August 27 to support a recommended offer based on the proposed financial terms. Cevian has held shares in Vesuvius since 2012 and has a representative on the company's board.
The latest approach follows a series of proposals from RHI Magnesita dating back to September 2025. The first, submitted on September 29, 2025, valued Vesuvius at 448 pence per share in cash. Further proposals followed in October, November and December, but Vesuvius's board rejected the earlier approaches.
Long-running negotiations remain unresolved
On March 17, 2026, RHI Magnesita proposed an all-cash offer of 550 pence per Vesuvius share, after which Vesuvius granted access for confirmatory due diligence. RHI Magnesita revised the structure on June 23 to 454 pence in cash and 96 pence in new shares, maintaining a total value of 550 pence per share. Vesuvius rejected that proposal on June 29.
The June share issuance was capped at 9.5 million new shares, equivalent to approximately 20% of RHI Magnesita's issued share capital at the time. The March and June proposals also allowed Vesuvius shareholders to retain the 16.5-pence final dividend for 2025, paid on July 6. They included an additional payment of 2 pence per share for every month that completion extended beyond 15 months after a firm-offer announcement, subject to a three-month maximum. That provision is absent from the latest proposal.
Under the UK Takeover Code, RHI Magnesita has until 5 p.m. London time on October 27 to announce a firm intention to make an offer or state that it will not proceed. The Takeover Panel may consent to an extension. Vesuvius said it disclosed the proposal without RHI Magnesita's prior agreement or approval. Both London-listed companies supply refractory products used in steelmaking and other high-temperature industrial processes, meaning a transaction could combine two important suppliers to customers whose operations depend on the durability, availability and technical performance of these materials.