Kerry Stokes' Seven Group Holdings (ASX:SVW), hoping for an easy mop-up bid for the rest of Boral (ASX:BLD), has hit heavy going with the target company telling shareholders on Tuesday to reject the offer.

Boral's independent directors said the independent expert (Grant Samuel) had "concluded that the SGH Offer is not fair or reasonable" and listed a long list of reasons why that was so.

Stokes and his family control around 57 per cent of Seven Group and had built a 70 per cent stake in Boral before launching the mop-up bid in February with a series of incentives for shareholders to get more as acceptances rise towards the 90 per cent level.

On Monday, Seven Group said its Boral stake had risen to 72.6 per cent and the offer seemed on track -- despite mumbling from sections of the market about unhappiness among some hold-out shareholders.

Also on Monday evening, Macquarie Group (ASX:MQG), a substantial shareholder, lobbed a new substantial shareholding notice that revealed it had built its stake in Boral to 6.38 per cent from 5.21 per cent at the start of March (which was after selling down millions of shares in January and February).

Macquarie moved from a holding of 57.497 million on March 5, to 70.338 million as at last Friday, March 15.

Macquarie's purchases have helped keep the Boral share price above the putative $6.07 a share value in the complex Seven Group offer. The shares ended at $6.10 on Monday. Many of the buys and sells were above $6.20 a share.

The dealings in the period involved buying and selling but were dominated by two purchases last Friday of a total of 15 million shares in two parcels. One parcel for 6.650 million was done at $6.11 a share, the second, 8.445 million was done at $6.10 a share.

Those two parcels alone effectively lifted the Macquarie stake in Boral to 6.38 per cent last Friday from 5.71 per cent on March 5.

But Boral said the 190-page independent experts report "estimated the fair market value of Boral Shares to be in the range of $6.50 to $7.13 per Boral Share; and assessed the value of SGH's Offer Consideration to be lower than this and in the range of $5.96 to $6.19 per Boral Share (and up to $6.39 per Boral Share including the conditional payments)."

"The Independent Expert has also concluded that the SGH Offer is not reasonable" and the independent Boral directors urged shareholders to reject the SGH offer.

Tuesday's statement continued, saying that the "implied value of the SGH Offer does not represent any meaningful premium to the recent historical trading prices of Boral prior to the SGH Offer.

"Boral's outlook is robust and supported by positive market fundamentals; Boral is making meaningful progress on its strategy and is expected to continue to deliver value for Boral Shareholders through its strong earnings growth and free cash flow generation."

And the independent experts report said that there was also the "opportunity for Boral to realise latent value from its surplus property portfolio, which may then be reflected in Boral's share price in the future. The Independent Expert has attributed a value of $1.4 to $1.6 billion ($1.26 to $1.44 a share) to the property."

Boral said this property valuation was more than the most recently disclosed surplus property value of approximately $1 billion as part of its FY23 results and worth an extra 36 cents to 54 cents a share more when compared to the $1 billion valuation.

As well, Boral said shareholders should ignore the threat from SGH that Boral is unlikely to pay dividends for some time.

"The payment of dividends is a matter for the Boral Board at the relevant time acting in the best interests of all Boral Shareholders. Boral has significant capacity for capital management, and is expected to be in a position to pay fully franked dividends by the second half of FY2025."

It also said it "has a strong future as a standalone ASX listed company with a substantial free float of approximately $1.9 billion and a register of approximately 47,000 shareholders."

"SGH has stated that it intends to seek to delist Boral from the ASX, subject to compliance with all legal requirements. However, there are material constraints on

SGH being able to have Boral delisted by ASX outside of compulsory acquisition."

"There is uncertainty regarding the value of the SGH Shares which you would receive if you accept the SGH Offer. SGH Shares are trading near all-time highs, and the share price is not supported by dividends, with SGH having a dividend yield (based off dividends for the 12 months ended 13 December 2023) of slightly over 1 per cent.