Fletcher Building, the largest company listed in New Zealand, has offered money worth about $740 million for purchasing the Crane Group, an Australian firm for the purpose of plumbing and building supplies, and is apparently out to diversify and broaden its business.

The offer increased Crane's shares high up by 22 percent on Wednesday. The Australian company suggested that the shareholders should not take any action since its board is ready to meet and talk about the offer.

According to analysts, a deal will aid in further diversifying Fletcher's earnings base away from New Zealand, where the economic growth predictions have yet again been reduced because of a weak domestic demand.

According to investment manager Richard Morris, this is a positive move for achieving further Australian exposure and at such a price that they are pitching for. Thus it should be a good deal. Moreover, there isn’t much of any kind of control premium, added he. It is Crane’s shares that the Constellation holds Crane shares, and not Fletcher's.

Fletcher Building is one among the largest laminates makers in the world. It is also the owner of Laminex and Formica and also the interests in building materials and construction.