Nexans interested in all of Draka: CEO

By Gilles Guillaume

PARIS (BestGrowthStock) – Nexans (NEXS.PA: ), the world’s biggest cable maker, is interested in buying all of Dutch cable maker Draka Holding NV (DRAK.AS: ) and not just some of its businesses, its chief executive said.

Frederic Vincent was speaking to told Reuters after Draka, Europe’s third-largest cable maker, on Wednesday rejected Nexans’ unsolicited takeover offer worth 731 million euros ($1 billion), saying it undervalued the company.

Vincent also said that Nexans, one of the world’s largest private consumers of copper, expects copper prices to stay at high levels for the rest of 2010 and in 2011.

Nexans is confident it will deliver on its 2010 financial goals though restructuring costs will limit expected profit, he added.

“In making an offer for the whole of Draka, we would be buying all of its businessses,” Vincent said.

Nexans has replied to Draka’s rejection, saying that its proposed cash bid of 15 euros per share “fully valued the company” at an attractive premium of 28.4 percent over Draka’s average closing share price in the three months before October 18, when it announced its intention to start discussions with Draka.

Nexans also said after the market closed on Wednesday that although Draka’s boards had refused any discussions to date, it remained open to talks and was studying its various options.

Some analysts believe that Nexans is mostly interested in buying some parts of its Dutch rival to beef up its portfolio.

“This is not the current scenario, this is not our starting point,” Vincent said, adding that Draka was “a quality asset and still an interesting asset.”

In the power cable segment, Nexans would help Draka consolidate its presence in the fragmented low-voltage market and combine it with its high-margin high-voltage offering, tapping into demand for replacing aging power infrastructure.

Draka is also a market leader in elevator cables. It has designed and provided cables for the 58 lifts of the world’s tallest skyscraper, Dubai’s Burj Khalifa, which towers some 828 meters above ground.

(Writing by Dominique Vidalon; Editing by James Regan)

Nexans interested in all of Draka: CEO