Guinness Peat sweetens offer for MMC Contrarian

Friday 16th October 2009

Guinness Peat Group, the investment group chaired by Ron Brierley, raised its offer for the 71% of Australian financial services group MMC Contrarian it doesn’t already own and said the new price is final.

GPG’s Ecurb Australia unit raised its offer to 50 Australian cents apiece for Contrarian from 48 cents, valuing the target of $70 million. The increase comes just a week before the offer is due to close on October 23 and GPG director Gary Weiss said the period won’t be extended.

GPG’s on-market takeover offer has pitted the corporate raider against Melbourne-based internet entrepreneur Nicholas Bolton, who owns 5.6% of Contrarian and has urged the company to do an on-market buyback as an alternative to GPG’s offer. Contrarian had A$78.9 million of cash reserves and no interest bearing debt as at June 30.

Contrarian’s independent directors last month rejected GPG’s initial 48 cents offer, saying it represented a 15% discount to cash backing and a 27% discount to net assets before tax. Further, GPG was already “a supportive cornerstone shareholder” and was unlikely to provide further commercial assistance, chairman Ray Kellerman said in the September 16 statement.

Weiss said the offer would be subject to an automatic 14-day extension from the Oct. 23 closing date if GPG voting power in Contrarian exceeds 50%.

GPG stock was unchanged at 89 cents on the NZX today and has edged down 1% this year.

Businesswire.co.nz

Comments from our readers

No comments yet