Travis Perkins has announced it has made an indicative offer of £553m for the BSS Group.
The cash and share offer comprises 232.91p in cash and 0.2608 new TP shares per BSS share, as well as the payment of BSS's final dividend of 6.09p per share for the year ended March 31 2010.

The offer values BSS at a price of 433p per BSS share, based on the closing share price of 745p per TP share on May 27, the last trading day prior to the announcement, and values the entire issued and to be issued share capital of BSS at approximately £533m.

It is intended that the cash component of the offer will be funded from the TP group's existing resources.

TP has said that it believes BSS could be successfully integrated into the company's current portfolio, and that the enlarged group would be able to source products more competitively and give the groups access to lower-priced properties from which to trade.

If BSS shareholders accept the offer, the deal would create the UK's largest plumbing and heating distribution business, with combined revenues of around £4.3bn and a total workforce of 19,000.

A statement from BSS said: "While the board of BSS remains confident in the stand-alone prospects for BSS, given the current volatility in the equity markets, the support of certain shareholders for the indicative offer and the significant scale benefits from a combination, the board of BSS would currently be prepared to recommend an offer by Travis Perkins to acquire the entire issued and to be issued share capital of BSS if made on the same terms as the indicative offer."