Lion uncorks Adelaide wine offer

By Phil Boeyen, ShareChat Business News Editor

Thursday 27th September 2001

Lion Nathan (NZSE: LNN) has moved on its wine expansion promise, launching a takeover for Adelaide-based wine group, Banksia Wines.

The offer makes good on Lion's resolve after missing out on Montana that it would continue to seek growth through wine industry acquisitions.

Lion is offering A$1.12 in cash for each share and a fully franked final dividend of A3.2 cents from Banksia Wines. The offer is a 35% premium to Banksia's Tuesday closing price and a 51% premium to the three-month volume weighted average price of A76 cents per share.

Banksia Wines has only been listed on the ASX since December last year after being formed several months earlier from the merger of South Australian wineries St Hallets in the Barossa Valley and Tatachilla at McLaren Vale, south of Adelaide. The group's shares were floated at A85 cents each.

Since listing the company has added another South Australian winery, Hillstowe Wines, to its portfolio.

Lion Nathan has already acquired 14.9% of the shares in Banksia Wines from the chairman and executive director at the offer price.

LNN boss, Gordon Cairns, says the company's offer values Banksia at a premium and the Banksia Wines board, in recommending the offer, recognises that the price is attractive.

"As a significant player in the Australasian liquor business, Lion Nathan with its strong balance sheet, competitive cost position and robust cash flows is ideally positioned to build a value creating premium wine business.

"Banksia Wines, with its well-respected brand portfolio, highly regarded winemakers and experienced management team, represents an important first step in gaining exposure to the Australian wine sector."

Banksia Wines chairman, John Lamb, says the association with the former New Zealand brewer will provide the company with the ability and resources to grow its portfolio of premium brands.

'The board is confident that this offer is in the best interest of all our shareholders, employees, customers and suppliers. The board recommends that all shareholders accept the offer as soon as possible."

Lion's offer is subject to a 50.1% minimum acceptance condition and regulatory approval.

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