NBH unworried by Elders

Press, 12 April 1988, Page 23

NBH unworried by Elders

BIPA-Reuter Melbourne ■ The managing director ofj North Broken Hill Hdldings, Mr Peter Wade, says Elders Resources is too busy bidding for NZ Forest Products to pose a threat to his company. Mr Wade discounted speculation that the mining and forestry conglomerate’s largest shareholder, Elders Resources, was close; to bidding for North, which recently merged with PekoWallsend.

‘‘l do not see Elders making a bid,” he said. '"They are in a bind with the bid for NZ Forest Products and that will take time,” he said. I Elders Resources is an associate of Elders IXL. Analysts have predicted a ! bid for North once Elders Resources completes it sAust97o million reverse takeover of NZ Forest Products. :|“I cannot say there will

or will not be a bid at some stage, but I do not see any signals that indicate I that a bid is imminent, ”| Mr Wade said. , “They are busy con-! summating NZFP, and thei whoje environment doesnot appear conducive to a bid.’ | j Analysts said Elders' Resources and executives of Elders IXL already! havd taken effective control | of NZFP, whose shareholders I last week cleared the final obstacles

for the bid to! proceed. Elders Resources holds a 21.7 per cent stake in the I merged North/Peko; ,largely through shares held by NZFP, but has declared an interest in a further 10 per cent that is a North parcel held by Peko. Mr Wade 'said Elders Resources does not have o the| right to claim an' interest in 31.7 per cent of North, which would de-

liver control to {Elders, without reference to other shareholders. |

But analysts say the 10 peri cent North I parcel poses a dilemma j for Wade, since under'legislation prohibiting. companies from holding their own shares, North must dispose of the roughly $l6O million stake within 12 months. ; An Elders Resources spokesman said the company stood by its notice of interest but did riot {wish to {comment on Wade’s assertion that a bid for North-Peko is unlikely.

“We do not want to be more specific about (anything that could cause a rift between the (companies at this stage,” the spokesman said. { : Analysts had earlier said Elders would be among those shareholders annoyed by North’s revision of its offer for(Peko options to a cash-only

rather than a proposed casti/scrip ; choice, which would have made Peko options an inexpensive entry (to the merged NorthPek'o. Mr Wade said he hoped Elders Resources and North could co-operate rather than become engaged in a difficult takeover battle since they have many complementary businesses. “There fare a lot of similarities in a range of businesses in which Elders; and North are involved. There is scope to work together,” he said. "There |are opportunities for us to talk about these common areas for the benefit of both groups of shareholders.” Elders will collect a major forestry and wood goods business! Through NZFP, and both companies see parallels with North’s forestry and kraft divisions.