Vienna-based refractory supplier RHI Magnesita has confirmed advanced discussions over a possible cash-and-share takeover of UK-listed refractory and flow-control supplier Vesuvius.

RHI Magnesita supplies heat-resistant bricks, linings and materials for cement kilns and other industrial furnaces, alongside installation expertise and technical services.

The latest non-binding proposal, submitted on 27 August and disclosed on 29 September, comprises GBP4.70 (US$6.23) in cash and approximately 0.028 new RHI Magnesita shares for each Vesuvius share. Based on RHI Magnesita’s closing share price on 28 September, it values each Vesuvius share at GBP5.49, a premium of approximately 47 per cent.

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Vesuvius said its board is evaluating the financial terms and execution risks. Its largest shareholder, Cevian, which holds approximately 23 per cent, has committed to support an offer if recommended by the board.

RHI Magnesita has until 27 October to announce a firm offer or withdraw, unless the deadline is extended. There is no certainty that a firm offer will be made.