The logistics giant says it is also looking at other strategic options to unlock shareholder value as the private equity group circles.
A decision is expected to be made by the end of June, with some investors worried it could be a drag on returns.
“Private equity will be able to look through that to the other side,” Mr Wood said. Investors Mutual owns 17.5 million shares, which represents a 1.2 per cent stake.Mr Wood said Brambles had shown it was able to exert pricing power by lifting prices to customers, which would also be attractive. “They’ve demonstrated they’ve got pricing power,” he said.
“The board is also considering other strategic options for the company that maximise shareholder value,” it said. Brambles also said the company’s trading performance had improved. It had a small profit upgrade on April 21 as the benefits of price increases to claw back higher costs, flowed through.to private equity firm Triton and an arm of the Abu Dhabi Investment Authority.
Stockbroking analysts Jarden late last month estimated the plastic pallets investment decision could result in net capital spending of $US600 million to $US700 million phased over two to four years.The analysts said the change in sentiment in the April 21 announcement indicated a higher benchmark for return on capital investment than the previously signalled decision, which was conditional at 10 per cent to 15 per cent returns.
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