K.P. more than matches offer for Dominion

Press, 3 September 1977, Page 1

K.P. more than matches offer for Dominion

PA Wellington The fertiliser fight has started another round. Kempthome Prosser announced yesterday that it had raised its bid for Dominion Fertiliser shares, and its rival, Ravensdown, has put in its formal takeover offer for Dominion. Speaking after a special directors’ meeting in Wellington, K.P’s chairman (Mr P. W. Fels) said it had decided to offer an unchanged bid of $3 cash for each share — but was now adding one K.P. share to the offer price. At yesterday’s sale price of 158 c this valued each Dominion Fertiliser share at 458 c. Ravensdown, the farmers’ co-operative company, has lodged its formal takeover offer for Dominion Fertiliser. The shareholders of Dominion Fertiliser will be officially notified of the terms of the Ravensdown offer when the mandatory 14 days have elapsed. Ravensdown has offered 425 c for each Dominion share.

The chairman of Dominion (Mr T. McCristell, Balclutha) said the new K.P. bid would be studied by his board at its next meeting on Friday. “I am still quite keen on the farmers’ bid of course, but I will have to examine the K.P. bid in the light of the value of the two bids,” he said. The chairman of Ravensdown (Mr P. H. Elworthy) said from Queenstown last evening that the K.P. bid would have no effect on his company’s attempt to gain control of Dominion. Farmers had continued positive support for Ravensdown, and given this reaction K.P. would not be able to gain control or prevent Ravensdown from gaining control of Dominion, he said. “It is a simple matter of mathematics. The share price for Dominion has been to 440 c and the farmers still remain with us.” He repeated that his company considered it had effective control of more than 50 per cent of the ordinary shares in Dominion.

Two weeks ago, K.P. shares were selling cum dividend at 135 c, but they have steadily increased in value, and shed a 9c dividend this week. Mr Fels said his board had decided to give notice that it would lodge the new bid after necessary documentation. The new bid was better than the Ravensdown bid. he said. "It is getting very close to full asset backing of $4.72 for each Dominion Fertiliser share.” Dominion shares reached 540 c on the Stock Exchange again yesterday after beginning the week rt a new high of 525 c and then dropping by up to 37c, says a PA report from Dunedin. But turnover was considerably lower than on previous days with 3900 shares being traded nationally. The big number of shares traded in the last few weeks makes it very difficult to ascertain who holds what shares in Dominion.

Many share transfers have not come through indicating, the possible

presence of speculators in the take-over battle. Market sources said yesterday that at least one big block of shares held by Government Life — and said to be the equivalent of 4 per cent of Dominion’s ordinary shares — had not been traded. The Auckland based firm. New Zealand Farmers’ Fertiliser, Ltd, in which K.P. has substantial interests, was said to be the “mystery bidder” which last month sought 15 per cent of Dominion’s ordinary shares. Sources said this buyer had dropped out with a smaller parcel of shares than it had sought. Brierley Holdings was also said to have been an independent bidder which might have withdrawn in the last few days. K.P. says the Ravensdown claim to more than half of Dominion’s shares is highly unlikely, “in view of the holdings of K.P. and other parties.” Ravensdown will need to control 60 per cent of the Dominion capital to convert the company into a co-operative for tax purposes.