GPG offer may breach takeover code on several counts

By NZPA

Monday 2nd September 2002

Guinness Peat Group's (GPG) proposed partial offer for forestry company Rubicon may have breached takeover rules on several counts, including putting forward too many options, the Takeovers Panel says.

The panel met on Friday and found the offer may not have acted or "may intend not to act" in compliance with the Takeovers Code "in a number of respects".

Two meetings will be convened on Thursday, one at the request of Rubicon shareholder Perry Corporation, to determine whether the the panel will exercise its powers.

The meetings would be in private, the panel said.

Perry Corporation is a 16 percent shareholder in Rubicon and is locked in court action with GPG. It has persuaded the panel to consider that GPG has not made its offer open to all shareholders because the interim injunction lodged against Perry means its shares are unable to be sold.

The panel has also found that GPG may be in breach in offering two alternative offers at the same time.

GPG, a 19.9 percent shareholder in Rubicon, has made a bid for up to 40 percent of shares at 75 cents per share, which would take its stake to 52 percent.

Under the plan, if it did not get more than half the company, GPG would seek shareholder approval to take a cornerstone shareholding of between 30 percent to 50 percent.

The panel said the second offer may also be in breach because it did not specify a specific percentage of voting securities.

Rubicon, a Fletcher Forests spin-off, was integral to an unsuccessful $1.4 billion bid by Fletcher Forests to buy the Central North Island Forest Partnership.

Rubicon owns 17.6 percent of Forests and was to sell its shareholding in return for forestry land and a share price higher than Forests currently trades at. The deal was defeated by Forests shareholders.

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