Rinker Group (NYSE:RIN) received a buyout offer for $11.7 billion (or about $65 per share) in cash from Cemex (NYSE:CX) on Friday that it today called "highly conditional" and one that "materially undervalues the company". With the stock currently trading above $71, investors are clearly looking for more too.

According to the SC 14D9 filing with the SEC:

"On Friday 27 October 2006, Cemex S.A.B. de C.V. (“Cemex”) announced that it intends to make a cash takeover offer for Rinker Group Limited (Rinker) at US$13.00 per share, equivalent to A$17.00 per share (based on an average exchange rate of A$1.00 to US$0.7645). A copy of that announcement was sent to Rinker by Cemex and is attached.

Rinker Chairman John Morschel said the Cemex announcement indicates that the unsolicited, hostile offer will be highly conditional.

'The preliminary view of the Rinker Board is that the proposed offer is opportunistic and materially undervalues the company,' he said.

Mr Morschel said Rinker’s performance of 40% compound annual growth in earnings per share over the past five years, together with strong growth in revenue (19% p.a. compound) and earnings before interest and tax (33% p.a. compound), has made it one of the best performing construction materials companies in the world.

'Directors will keep shareholders fully informed of further developments and will provide a formal recommendation on the offer in ample time for shareholders to make an informed decision,' he said.

'Shareholders should take no action in relation to Cemex’s offer at this time or any document received from Cemex until they receive the directors’ formal recommendation.'

Rinker has retained UBS as its financial adviser in relation to the proposed offer." (Read More)

This stock is definitely one to keep an eye on as both management and investors are looking for a better offer. It is not uncommon in these situations for the bidder to raise the bid one or more times to satisfy at least one of the two groups.

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Cemex (CX)