Spanish infrastructure giant Ferrovial is making a second tilt at detention centre operator Broadspectrum with a cut price $715 million takeover bid.
Shares in Broadspectrum, the company formerly known as Transfield Services, soared almost 50 per cent on Monday after Ferrovial unveiled its latest move for the operator of Australia's offshore detention centres.
Ferrovial was thwarted in an attempt to buy Transfield a year ago when the company's board knocked back a $2.00 per share offer.
But with Broadspectrum's share price having halved since then, Ferrovial has returned with an all cash offer of $1.35 per share that values the company at $715 million.
The offer price represents a 59 per cent premium on Friday's closing price of 85 cents.
The news sent Broadspectrum's shares soaring to as high as $1.31. They closed up 40.5 cents, or 47.65 per cent, at $1.255.
"Our offer provides Broadspectrum shareholders the certainty of cash consideration, eliminating the risks associated with the near term outlook in Broadspectrum shares," Ferrovial chief executive Santiago Olivares said.
"We look forward to engaging with all stakeholders regarding the offer."
In its bidder's statement, Ferrovial said shareholders should remember there was no dividend paid in FY15 because of Broadspectrum's high debt and that the company's future earnings were heavily reliant on it retaining the Australian government contract to operate detention centres on Nauru, Manus Island in Papua New Guinea.
Broadspectrum's five-year contract with the Department of Immigration and Border Protection expired in October 2015. It was extended for four months from November the firm is the preferred bidder for a new five-year contract.
Broadspectrum shareholders investors approved the company's name change at October's annual general meeting after its founding family withdrew its rights to use the Transfield name due to the controversy surrounding the company's operation of the offshore detention centres.
Some investors sold their shares because of concerns over alleged human rights abuses.
The takeover will proceed on the condition Ferrovial acquires more than half of Broadspectrum shares and that it gets Foreign Investment Review Board approval.
Ferrovial, which is listed on the Madrid stock exchange, employs 69,000 people across about 25 countries and focuses on services, toll roads, construction and airports.
Its services contracts include running London's Docklands Light Railway Limited that connects Canary Wharf with the city, a waste treatment plant in southern England, and a smart parking project in Madrid.
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