PRG puts heat on Bendon directors

By Phil Boeyen, ShareChat Business News Editor

Thursday 21st February 2002

Bendon (NZSE: BEN) suitor Pacific Retail Group (NZSE: PRG) has criticised a revised management buyout bid by the AMP/Venter consortium and says its surprised the Bendon board is treating the offer seriously.

PRG has a full takeover offer in for the group at $1.90 per share and the AMP/Venter group yesterday indicated it would be willing to pay up to $1.99 for the lingerie subsidiary, Bendon Limited.

Although the Bendon board said the terms of the new offer are not currently in an acceptable form they are continuing to work with the AMP/Venter consortium and say a decision will be made later this week on their offer.

However PRG boss Peter Halkett says the partial bid is not in the form preferred by the board and doesn't allows shareholders to make a clear comparison with his company's offer.

"Because of the risks inherent in a partial offer, which leaves shareholders saddled with any uncertainties associated with winding the company up, it's impossible to make a true comparison.

"Management wants to buy the bra and leave shareholders to sort out the knickers"

Mr Halkett also says that, given the numbers, the new offer is doomed to fail and will not get the 75% shareholder approval that it requires.

"It's a blatant and continuing attempt by insiders to get around the provisions of the Takeovers Code. We have been concerned that, from the outset, management's offer was clearly not intended to be contestable and, had we not become involved, it wouldn't have been. This revision does nothing to allay those concerns.

"PRG has consistently indicated from the outset that our intention is to acquire Bendon. We looked. We bought. We bid. And we're not selling. Whether our bid achieves 50% or not, we're in for the long haul."

PRG director, Phil Newland, has also raised concerns about senior management's focus on day-to-day business.

"There are clear conflicts of interest in a number of areas, not least in management's ongoing role in the attempted purchase, its ability to continue to build value while pursuing this doomed bid and its relationship with AMP Henderson, who appears to be acting as both a seller and a buyer."

"We are concerned that, as a result of management's current focus, the company is now deteriorating on a number of fronts."

Mr Newland says if the current offer is allowed to proceed and fail it will not only will be expensive for the company, but will likely destroy shareholder value by continually diverting management attention from the demands of a fast-moving industry.

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