C.F.M. Receives Formal Bid

Press, Volume CVIII, Issue 31868, 21 December 1968, Page 1

C.F.M. Receives Formal Bid

The Waitaki Farmers’ Freezing Company, Ltd, has given formal notice of its take-over scheme to the Canterbury Frozen Meat Company, Ltd.

Under the Companies Amendment Act, 1963, C.F.M. must within 14 days send Waitaki a statement which complies with the second schedule of the Act. This includes whether or not the board recommends the bid. Waitaki has indicated that it will send the terms of the bid to shareholders between January 7 and 10, and this will also include the decision of the C.F.M. board on the terms of the bid. The terms of the offer are those previously announced: isix Waitaki 50c shares are bell

j ing offered for every five 100 c i shares of C.F.M., plus 28c for each C.F.M. share. Mr D. G. McEwan, secretary of Waitaki, replying to a suggestion that his company might have run into a legal snag in regard to the offer under section 73 of the Meat Act, 1964, said that the Waitaki board was confident that the Minister’s approval for the merger would be given at the appropriate time. He said that the Waitaki board would be sending a circular on the matter to all shareholders as soon as possible. Part of section 73 says: “It shall be deemed a condition of every licence Issued in respect of an export slaughterhouse that the licensee, or, if the licensee is a company, any subsidiary of the licensee or any company of which the licensee is a subsidiary, shall:

not after the commencement of this Act acquire any estate or interest in any company which is the licensee of an export slaughter-house without the consent of the Minister given after consultation with the Meat Producers’ Board.” The Act then says that in an acquisition contrary to the provisions of this section, the Minister may refuse to consent to the renewal of the export licence. When this section was added to the bill at the second reading, late in 1964, at the insistence of the Meat Board, the Minister of Agriculture (Mr Taiboys) said that this was done because of concern about a possible future diminution of competition. Canterbury and North Otago farmers are relying on Ithis section to defeat the bid.

t A pointer to stock market 5 thinking may be that C.F.M. f shares sold 5c lower yesteri day, at 210 c. This is 76c lower - than Waitaki’s theoretical :- bid. i The Prime Minister (Mr ’ Holyoake) has been urged to take all possible steps to see i that C.F.M. is not taken B over by Waitaki. 5 A Press Association mes- • sage from Timaru says that b a telegram to this effect was sent to Mr Holyoake and the s chairman of the Meat Board > (Sir John Ormond) yesterday t afternoon by the executive of t South Canterbury Federated - Farmers. 1 The telegram also exprese sed “grave concern about e the implications contained in '■ the proposed take-over, as 5 they affect -the meat producer jland the New Zealand meat I. [industry as a whole.”