Van Elle Holdings PLC (AIM:VANL) has agreed to a £58.8 million cash takeover by a UK subsidiary of Vienna-listed construction group Strabag.
Shareholders in the ground engineering contractor would receive 52.3p per share under the offer, which represents a 58.5% premium to its last closing price.
The board has unanimously recommended the deal, following a review last year concluded that valuation upside was likely to be limited in the near term amidst weak trading liquidity and subdued sentiment towards smaller UK-listed companies.
The company said the all-cash offer provides certainty compared with executing its standalone strategy, which carries operational and market risks.
Strabag said the acquisition supports its growth strategy and expands its capabilities in ground engineering across residential, infrastructure, energy and water markets.
Van Elle will not pay a dividend before completion. The Austrian company is expected to complete the deal by the end of June, subject to shareholder and court approval.
Irrevocable undertakings and letters of intent have already been secured over around 45% of the share capital.
Van Elle chairman Frank Nelson said with the company being formed in 1984, Van Elle's "life as a quoted company is a short part of that history", having listed on AIM in 2016.
"Given the ongoing cycle, the Van Elle board believes that the offer not only represents a significant premium, it also provides shareholders with the certainty of cash consideration and Van Elle's customer base with a supportive sector specialist owner focused on developing its product offering."