Japan's HCM takeover offer for Bradken

25.10.2017 Alberto Colla, Bart Oude-Vrielink, Geoff Carter, John Mosley, Con Boulougouris

MinterEllison has advised Tokyo based Hitachi Construction Machinery (HCM) on its first public market takeover in Australia.


In early 2016, Japanese firm Hitachi Construction Machinery (HCM), which manufactures mining equipment, including excavators and dump trucks, began a worldwide search for suitable targets to grow its revenues.

It identified the then ASX listed Bradken as an attractive takeover option, seeing its operations as being highly complementary, and as an avenue to extend its reach into the Australian mining industry.

HCM’s all-cash offer was for 100 percent ownership of Bradken, for an enterprise value of approximately $976 million.

MinterEllison advised the Tokyo based HCM on its first public market takeover in Australia. HCM had also never previously pursued an acquisition of a publicly listed company. For these reasons, the deal was transformational for HCM.

Advising HCM on the offer was a team led by partners Alberto Colla and Bart Oude-Vrielink.

Bradken manufactures machined cast iron and steel equipment for the energy, mining and rail industries. It employs approximately 3,500 people in 24 locations around the world, including the USA, the UK, India, China, Canada and South Africa.

What was the role of the firm?

MinterEllison was involved from commencement to completion, spanning approximately 9 months.

MinterEllison undertook the Australian legal due diligence for HCM, and coordinated the legal due diligence in the other jurisdictions in which Bradken operates. 

HCM's offer was subject to clearance from numerous regulators, including the Foreign Investment Review Board (FIRB), the Australian Competition and Consumer Commission (ACCC) and equivalent competition authorities in a number of other jurisdictions in which Bradken operates. Due to Bradken’s involvement in supplying components to the US military, there were additional, sensitive US regulatory approvals that needed to be obtained.

MinterEllison engaged with our domestic regulators to secure approvals, and played a key coordinating role in securing the suite of foreign regulatory approvals. 

Outwardly, Bradken’s business appeared quite straightforward. However, because Bradken has substantial business operations outside Australia, the legal due diligence was extensive and meant that the nature and scope of foreign regulatory conditions to the offer had to be carefully considered.

More than 50 percent of Bradken's revenue was derived from offshore markets and a complex capital and debt structure. Its shareholder base was also atypical in that it included two large private equity firms, and a strong institutional shareholder presence.

MinterEllison also drafted the offer documentation sent to Bradken shareholders. Achieving acceptance from key Bradken shareholders was imperative. To help with this, MinterEllison developed effective strategies to unlock acceptances from key shareholders, including from the two private equity firms who had previously submitted takeover proposals for Bradken and who had converted their debt into equity after HCM’s offer was announced.

By March 2017, the long list of regulatory approvals had been satisfied and the Bradken board confirmed to its shareholders that no rival offer had emerged in the five months since Hitachi's offer was first announced.

The strategies devised by MinterEllison to unlock acceptances from key Bradken shareholders and to otherwise create acceptance momentum proved effective: by the close of the offer, HCM had achieved an acceptance level of greater than 90 percent, entitling HCM to compulsorily acquire the remaining minority shareholdings and move to 100 percent ownership of Bradken.


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