H. Berry Board Rejects Christchurch Offer

Press, Volume CIX, Issue 32018, 19 June 1969, Page 15

H. Berry Board Rejects Christchurch Offer

T. J. Edmonds, Ltd, the unlisted Christchurch food company, which yesterday announced the acquisition of Pakenham Products, Ltd, an Auckland food maker, faces opposition in the second round of its struggle to take over Henry Berry, Ltd.

Edmonds was believed to be behind a take-over bid for Henry Berry earlier in the year, and last week it announced a new offer for the Wellington grocery merchant The terms were disclosed yesterday, together with their rejection by the Henry Berry board on the ground that the offer was “substantially inadequate.” Three Edmonds shares (currently selling down to 440 c each) are offered in exchange for four, Henry Berry shares (worth about 210 c each before the bid and now selling at 280 c after a rise to 300 c). The offer values them about 330 c. Edmonds have also offered two shares in exchange for every three 200 c preference shares in Henry Berry, giving them a value of about 293 c. The directors of Henry Berry resolved yesterday to recommend that their shareholders should not accept the bid. They said it was substantially inadequate, although it exceeded the earlier offer. Bonus, Cash Issues They propose to proceed with their announced intention to recommend to share-

holders a bonus issue of one for six, and later a cash issue of one for 12 at a premium of 25c with the power to sell rights. These proposals were agreed upon before the proposed offer from Edmonds was received. In their examination of the second approach, the directors found that their reasons for declining to recommend the offer, in addition to the inadequate consideration remained substantially unaltered. On both occasions the directors had been guided by detailed reports of the management and professional advisors, they said. When the offer is circulated by Edmonds, the directors win send all shareholders a detailed report explaining why the offer should not be accepted. Shares Exchanges The chairman of Edmonds (Mr C. W. Evans) announced yesterday that, as the result of an exchange of shares, Pakenham Products had joined the Edmonds group as a whollyowned subsidiary. Pakenham Products makes pickles, mayonnaise, sandwich spread and similar items under the El Pico brand, and the company has made very rapid progress in the Auckland market with its retail products. Bulk Packs Mr Evans said that the first major new development planned by the management of both companies was to produce—and distribute through the industrial division of Edmonds—a range of established and new products in bulk packs, for the growing institutional and catering market in New Zealand. Some El Pico products were considered ideal for export and the research and develop-

ment facilities of the group would assist the new subsidiary to extend its range by developing new items and designing suitable new machinery. Mr Evans said that Mr Len Pakenham who would continue as general manager, had been invited to join the board of the subsidiary, which would be situated at Howick.