Belgian industrial equipment supplier, TVH, has launched a £348 million bid to takeover Lavendon Group.

TVH said it is making the offer in order to create a "pan-European specialised equipment rental business", as well as the opportunity to target Middle Eastern markets.

Pascal Vanhalst, a member of the Executive Board of TVH, said purchasing Lavendon "would represent a significant step forward" in the growth of TVH's rental activities.

"It would also bolster our geographical expansion strategy as TVH Equipment would become active in new markets such as the UK, the Middle East and France," he said.

"With Lavendon's vast rental know-how and focus on safety, the customers of the enlarged group would clearly benefit.

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"Our strong preference has always been to announce an offer with the full support of the Board of Lavendon. TVH, Lavendon and our respective advisers worked together towards a firm offer announcement at a price of 200 pence per share in cash, which the Board of Lavendon intended to recommend. Following discussions with certain shareholders, we increased our proposed offer price to 205 pence in cash."

However, Lavendon's Board have issued shareholders to take no action.

In a statement, the company said: "Having consulted with certain of the shareholders approached by TVH, it was apparent that the level of support anticipated was not forthcoming. Consequently, the Board unanimously concluded that it was unable to proceed with a recommended offer, regardless of the proposed offer structure, due to concerns over the significant execution risk and the potential disruption to Lavendon's business.

"Lavendon is in robust health, well positioned across diverse geographic markets, with strong revenue growth, profits, cash flow and ROCE and a clear strategic direction to deliver substantial shareholder value over the medium term. The Lavendon Board advises shareholders to take no action at this stage."

(LM/MH)