Midland silent

Press, 19 August 1981, Page 24

Midland silent

The directors of Midland Coachlines. Ltd. met yester- : day to consider the take-over offer from Ceramco. Ltd, but would not make a statement after the meeting, nor comment on the bid.

The logical interpretation would be that they are planning to mount a defence, or at least hold, out for a better deal. However, Ceramco last night claimed to control 60 per cent of Midland’s capital as H. W. Smith. Ltd, had indicated its intention to accept the bid. '

H. W. Smith, Ltd, acquired a 20 per cent interest in Midland, in return for a 20 per cent shareholding in Bunting and Company, Ltd, in October last , year when Midland frustrated an effort by. the Auckland motor entrepreneur, Mr C. T. Giltrap, to gain control of the group. After Midland acquired Trans Tours two months ago it sold its Midland interest back to Smiths, as this hold-

ing was no longer necessary to give Midland an Australian presence. The Midland Trans Tours purchase might have precipitated the take-over bid launched by Ceramco. •. Mr Giltrap told NZPA that he had sold his 30 per cent holding in Midland because he felt there was a lack of co-operation from the company’s board on utilising vehicles and expertise of the Giltrap car companies. But he was also “perturbed” at the price paid for Trans Tours, understood to be around $BOO,OOO, and he criticised the goodwill content in the price. ,

The Midland shares were selling at about 170 c during Mr Giltrap’s market buying last year.. He is believed to have picked up around 5 per cent in recent weeks, pushing the price to 200 c. He is understood to have sold to Ceramco at a price similar to that being offered in its formal bid. The result, almost one

year after his unsuccessful attempt to gain a majority stake in Midland, is a profit something like $300,000, and the prospect of sizeable vehicle supply to Ceramco. In addition, Mr Giltrap may also have access to the Midland subsidiary Tasman Rental. Cars, now half-owned by Marac, which he sought through his bid last year.

He said that this was not central to the sale to Ceramco but both companies saw rental cars as a growth area. He was looking to a close association because Ceramco was a progressive company, was also Aucklandbased, and had strong management. By “teaming up” with Ceramco, Giltrap could offer its vehicle expertise and supply of the fleets needed by Ceramco, he said. A possible implication is that Mr Giltrap may also help by jointly running Tasman" Hertz franchise with his own rental car operation, in association with Ceramco.