Minority resist Cerebos Pac.

Press, 13 September 1988, Page 24

Minority resist Cerebos Pac.

The minority shareholders in Cerebos Gregg’s appear to have thwarted a cheeky takeover bid by the company’s major shareholder. Cerebos Pacific had offered to buy the 29 per cent of Gregg’s it did not already own. However, late last week it said acceptances had been received for only 200,000 of the 5.2 million shares sought. When the offer closed yesterday the position had not changed significantly, a Cerebos spokesman said.

Pacific made its first offer in June — of 250 c for each Cerebos Greggs share. An indication that the bid would meet opposition was that before the offer documents were mailed in July shareholders could receive 255 c a share on the sharemarket. Included in the documents mailed to shareholders was a letter from Cerebos Gregg’s three in-

dependent directors. This gave the offer the thumbs down.

The three, Messrs C. D. Baker, L. C. Baker, and O. R. Baker said an independent valuation assessed the worth of Cerebos Gregg's shares at 310 c each —60 c above the offer price.

The valuation was undertaken by sharebrokers Jarden Morgan. They said in their valuation that Cerebos Gregg’s forecast net profit for the 1987-88 year was $5.77 million, 25 per cent above the previous year’s.

“A further substantial improvement in net profit is anticipated in the 198889 year,” Jarden added.

Cerebos Pacific did not include an independent valuation with its offer documents. It did however say that the profit would be not less than $5.5 million for the .198788 year. In August the offer was raised 20c to 270 c a share but the three independent

directors did not change their stance and other shareholders were unimpressed.

A Wellington spokesman for Cerebos Pacific said shareholders had voted for the offer by raising the price of the company on the sharemarket. The company last traded at 285 c a share.

He said the poor response to the offer would make no difference to Cerebos Pacific’s commitment to Cerebos Gregg’s. . Gregg’s ‘ would continue to operate its food processing plant in Dunedin and fruit cannery in Roxburgh.

The failed bid adds to the growing list of offers which have had to be aborted because of the tenacity of shareholding minnows. These include Tranzequity’s attempt to take over Somex Corporation and Angora shareholders forcing Latitat No. 4, Ltd, to accept a compromise.