By Phil Boeyen, ShareChat Business News Editor
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Friday 23rd November 2001 |
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Danone on Thursday said it was extending its takeover bid for Frucor by two weeks to December 21 but has stood firm on the offer price of $2.35 despite an independent valuation of between $2.54 and $2.96.
Frucor's independent directors have sent a letter to shareholders saying they still recommend the offer from the French food and beverage group should be spurned.
"We continue to consider Danone to be one of the strategically attractive owners of Frucor. Our concern is simply that its offer price is inadequate" says committee chairman Ian Donald.
"You should also know that the independent directors have still not ruled out the prospect of a competing bid. The extended timeframe now makes this more feasible. We reiterate that you will not be disadvantaged by deferring your decision on whether or not to accept until closer to December 21."
Danone has criticised a number of the assumptions made by Grant Samuel in its appraisal report but Mr Donald says it has discussed those concerns with the advisor.
"For the record, Grant Samuel expressly notes that, contrary to the contention by Danone, it did not use Coca-Cola or PepsiCo multiples in valuing Frucor.
"Frucor management is confident it will achieve its full-year forecast. Profit in October exceeded budget."
Mr Donald adds that the Grant Samuel valuation range of $2.53 to $2.96 a share is consistent with the majority of broker research report valuations.
"Frucor management has delivered quite exceptional growth over recent years and we note it was recently voted by Forbes Global Magazine as one of the top 20 small companies in the world. Forbes based this on Frucor's "strong growth prospects, impressive management and innovative products and services".
Danone spokesperson, Simon Israel, says the company has extended its bid to give shareholders more time to consider its offer.
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