Lion has new plan of attack for Montana

By Phil Boeyen, ShareChat Business News Editor

Monday 2nd July 2001

Lion Nathan (NZSE: LNN) is planning to make a full takeover bid for Montana (NZSE: MON) at $3.70 per share, the first company to announce a takeover under new legislation.

The brewer, which was last week told it must sell a 19% shareholding in Montana as penalty for breaching NZSE listing rules in February, wants to digest the rest of the company in two bites.

It will first make an initial partial offer for 11% at $5.50 per share. This will take its shareholding back over the 50% mark, after allowing for the forced sell-down off the 19% stake that will drop its current holding from 62.8% to 43.8%.

After acquiring the 11% holding, it will then make a subsequent offer for the remaining Montana shares it does not own at a price of NZ$3.70 per share.

The company says if it receives acceptances under its initial partial offer for more than 11%, acceptances may be scaled down.

" Shareholders will then have the opportunity to divest any remaining shares in the subsequent offer. If all shareholders, except Allied Domecq plc, accept both offers for all their shares, accepting shareholders will receive an average of no less than NZ$4.38 per share," Lion says in a statement.

Chief financial officer, Paul Lockey, is touting the move as a positive one for both Lion and Montana.

"Lion Nathan's offers provide Montana shareholders with an opportunity to sell all their Montana shares at fair value.

"Lion Nathan is committed to Montana and the New Zealand wine industry and believes that the success of its offer is in the best interests of Montana, Lion Nathan and the industry.

The initial partial offer is subject to Lion Nathan acquiring more than 50% of Montana shares.

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