Montana continues upward spiral

By Phil Boeyen, ShareChat Business News Editor

Monday 14th May 2001

Shares in Montana (NZSE: MON) are continuing their upward momentum as both Lion Nathan (NZSE: LNN) and Allied Domecq reconsider what they are prepared to pay for the winemaker.

Lion Nathan has today announced it intends to buy at least 5% more Montana shares but has not yet finalised what price it is prepared to pay.

The company is currently a majority owner of the winemaker with 51% of shares and says it will begin purchasing more from tomorrow.

Its earlier restricted transfer notice detailed a range between $3.95 and $4.70 but in today's announcement says it is currently considering increasing the price range.

With Lion in the market from tomorrow it will once again be in the race for the shares with UK-based Allied Domecq, which continues to seek a strategic stake although wants to buy 100% of Montana.

Allied managed to gain just under 6% of Montana during a market stand on Friday at $4.55 although it had been aiming for 10%.

Allied brokers UBS Warburg withdrew the market stand this morning but Allied spokeswoman, Jane Mussared, says the company has been continuing to buy on market.

Montana shares have hit $4.75 in afternoon trading, pushing them beyond the most recent appraisal report, which valued them between $4.24 and $4.72.

Lion Nathan CFO Paul Lockey is unhappy with Allied's continuing push for Montana shares.

"Our investment in Montana is an integral part of our strategy to build a substantial Australasian wine business and this further investment demonstrates how important Montana is to the success of that strategy".

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