Forum Archive Index - February 2002

[kevinst@catcha.com]

>From: "Nick Kearney" <nickk@quicksilver.net.nz> 
>Date: Sun, 20 Jan 2002 15:34:07 +1300 


>Yeah...you basically know what I was getting at.

>Consider now the p/e of some USA tech stocks which are still at 
>50 or above.

>Makes you wonder doesn't it.

>Cheers Pete.

>NK


Here comes the GRANT SAMUEL ADVICE at last. 

Now BEN is worth more than $1.94 per share comparing $1.81 two 
weeks ago. What a shame of "the Board"! 

"BEN
05/02/2002
GEN

REL: 1700 HRS Bendon Group Limited

GEN: BEN: UPDATE FROM INDEPENDENT DIRECTORS

Bendon Group has provided the following announcement:

The Independent Directors of Bendon Group Limited ("BGL") wish to 
update the
company's shareholders and the NZ Stock Exchange on the position 
relating to
the potential bids for BGL shares, or the operating subsidiary 
Bendon
Limited.

SUMMARY OF RECENT ANNOUNCEMENTS
On 14/01/2002, BGL's Independent Directors ("the Board") announced 
that,
following receipt of further expressions of interest and an 
indicative
non-binding offer, it had established a process to enable 
interested parties
to submit binding offers for the purchase of Bendon Limited 
(subject to BGL
shareholder's approval) on or before 01/02/2002.
Subsequently on 16/01/2002 Pacific Retail Group through its 
subsidiary
Pacific Retail Apparel ("PRG") announced it had acquired a 15.5% 
stake in BGL
from Tower Asset Management for $2.00 per share and acquired an 
option to buy
a further 3.55% stake at $1.90 per share from Alliance Capital 
Management NZ.
 This option was subsequently exercised, increasing PRG's stake in 
BGL to
19.05%.
On 18/01/2002, PRG announced its intention to make a full takeover 
offer for
BGL at $1.90 per share, conditional amongst other things on 
gaining at least
50% control.
Since receipt of PRG's notice, the Board has continued the sale 
process, and
allowed certain parties to complete due diligence on both Bendon 
Limited and
BGL.

CURRENT STATUS
The Board is satisfied that interested parties have had adequate 
opportunity
to approach the Board, submit indicative offers and, where 
appropriate,
undertake due diligence.  Including PRG and the Venter/AMP 
consortium, three
parties have undertaken due diligence.  Two parties have expressed 
a
continuing preference in acquiring only the operating business of 
Bendon
Limited, although competing takeover offers from those parties 
still cannot
be ruled out.  In the circumstances, the Board would prefer formal 
takeover
offers for BGL as it would enable shareholders to more 
transparently evaluate
competing bids.
As PRG's acquisition of its 19% interest and its subsequent notice 
of
takeover offer was made part way through the due diligence process 
for the
other parties, it has had some impact on the earlier announced 
sale process
and timetable (i.e. 1 February).
Although it is unclear if and when PRG's proposed offer will be 
made to BGL
shareholders, under the Takeovers Code it must be dated no later 
than
10/02/2002, be despatched to BGL shareholders within 3 days of 
that date and
remain open for acceptance for not less than 30 days and possibly 
up to 90
days.
Both of the other parties are currently giving further 
consideration to their
offer price and acquisition mechanism and all parties wish to 
consider Grant
Samuel and Associates' valuation advice.  Although the Board 
acknowledge that
they cannot control the timing of any PRG takeover offer, they 
intend to
continue discussions with all three parties with a view to having 
firm offers
available for review and recommendation as soon as possible.

GRANT SAMUEL ADVICE TO BOARD
As required under the Takeovers Code, the Board commissioned Grant 
Samuel to
prepare an Independent Advisor's Report on the merits of PRG's 
proposed
offer.  This report will be released in full by the Board as part 
of the
Target Company Statement after PRG's offer is made.  The Board 
expects that
the Target Company Statement will include its recommendation in 
relation to
PRG's offer and, if required, an explanation of the differences 
between
competing offers as well as implications for any shareholder vote 
and
timetable.
Grant Samuel has valued BGL in the range of $1.94 to $2.19 per 
share
comprising $1.23 - $1.47 per share ($37.9m - $45.4m) for the 
operating
subsidiary, Bendon Limited, $0.66 per share ($20.3m) for BGL's net 
cash after
remaining restructuring costs and seasonal replenishment of 
working capital,
and $0.05 to $0.06 per share ($1.7m - $1.9m) in surplus land and 
pre-paid tax
assets.  The current net cash estimate of $20.3 million compares 
with the
amount of $17.5m announced to the market late last year, the 
difference
explained by the net movement in Bendon Limited's working capital 
and
operating cash flow reduction in anticipated restructuring and 
liquidation
costs.  The net value to shareholders of the Venter/AMP offer 
announced late
last year was approximately $1.81 per share.  As the increase in 
BGL's net
cash position since then is largely offset by reductions in Bendon 
Limited
working capital, the net value of last year's Venter/AMP proposal 
has not
changed appreciably.

TIMETABLE
The introduction of additional interested parties has created 
uncertainty in
relation to timing of offers and shareholders meetings.
With regard to timetable, PRG's offer could conceivably open at 
the latest
allowable date of 10/02/2002 and remain open for acceptance until 
at least
early March and possibly as late as early May.
PRG's proposed takeover offer at $1.90 per share is dependent on
shareholders' acceptance, but not on a shareholder vote at a 
special meeting.
 Any alternative offer to acquire Bendon Limited would require 
approval via a
shareholder vote.  Given the notice periods under the Companies 
Act and NZSE
Listing Rules, and the documentation required, the shareholder 
meeting would
take place around six weeks after a binding offer is negotiated.  
The Board
has been advised that liquidation and interim distribution of the 
majority of
cash proceeds to shareholders could be expected to take another 
two weeks.
Although it could take up to 6 months to complete the full 
statutory
liquidation process for BGL, if there was a binding offer for the 
business in
the next few days, shareholder approval (or otherwise) might occur 
in mid
March and the majority of the payment to shareholders could take 
place during
April.

SUMMARY
This is a very complex and dynamic situation.  You can be assured 
that the
Board continues to seek an outcome which maximises the value of 
BGL for all
of its shareholders.  The Board is not in a position to make any
recommendation or further comment in respect of the merits of 
PRG's proposed
offer, or any alternative offers, at this time.  The Board 
believes that
shareholders should retain their shares pending release of the 
Target Company
Statement, or release of a further statement on behalf of the 
Board should
PRG's proposed offer not go ahead.
End CA:00075189 For:BEN    Type:GEN        Time:2002-02-
05:17:00:30 Encrypt:Y"



Cheers,

Kevin


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