The Gerard Lighting Group has endorsed a $186 million takeover offer from Lighting Group Australia, sending shares soaring more than 26 per cent.

Shares in Gerard closed 21.5 cents, or 26.71 per cent, higher at $1.02 on Wednesday, after coming out of a trading halt that was requested on Monday.

Gerard on Wednesday said it had entered into a scheme implementation agreement with Lighting Group for the $1.05-a-share offer.

Gerard Lighting distributes and sells lighting and allied electrical products in Australia and New Zealand.

Its major brands include Pierlite, Sylvania, Crompton, Moonlighting, Inlite and Austube.

Lighting Group Australia is owned by private equity group CHAMP.

News of the offer came as Gerard warned its full year net profit was likely to come in at the bottom end of its previous forecast of $17.5 million to $18.5 million.

Gerard deputy chairman Rick Allert said the company’s directors believed the offer was an opportunity for shareholders to secure an attractive premium for their shares.

“The independent directors’ recommendation is supported by the other directors and the proposal has the support of the major shareholders associated with the Gerard family,” he said.

The Adelaide-based Gerard family, which founded the Gerard Lighting Group, holds 52 per cent of the company’s stock.

Robert Gerard, a former board member of the Reserve Bank of Australia, is non-executive chairman of Gerard Lighting.

His youngest son, Simon Gerard, is managing director of the Gerard Lighting Group.

According to BRW magazine, Robert Gerard and family are worth around $215 million, which puts them in 195th place on the BRW list of the 200 wealthiest people in Australia.

Gerard Lighting listed on the Australian Securities Exchange in May 2010, with shares priced at $1.00.

The company booked a 15.7 per cent fall in profit for the first six months of the 2011/12 financial year to $8.5 million.