Goodman-IEL deal not wanted—AMP

Press, 12 June 1989, Page 29

Goodman-IEL deal not wanted—AMP

NZPA-AAP Melbourne At least half Goodman Fielder Wattle’s shareholders do not back its SAustl.B billion (5NZ2.267 billion) bid for Industrial Equity, Ltd, the AMP Society says.

“From discussions we’ve had around the market, with corporates, institutions and some individual shareholders, we believe there’s at least 50 per cent of the shareholders who are unhappy with the deal,” AMP’s Australian equities manager, Mr Merv Peacock, told Channel Nine’s “Business Sunday” programme. Despite discussions with Goodman Fielder Wattie since the bid was announced, the AMP — which holds about 9 per cent of the company — did not see value in it for shareholders. He said the Goodman Fielder Wattie board had a responsibility to ask its shareholders for approval. Leigh Hall, AMP’s chief general manager of investments, told Channel 10's “Business Week” he believed the Australian Stock Exchange should call for a Goodman Fielder Wattie shareholders’ meeting, and hoped it would do so in the next few days. The AMP Society, Elders IXL, and Ranks Hovis McDougall between them

hold about 34 per cent of GFW. Ranks Hovis has also expressed concern about the bid. "We don’t think it is a good deal anyway, and we don’t think it makes corporate sense,” Mr Hall said.

“The company has got all this cash back as a result of selling its Ranks (Hovis McDougall Pic) holding so there is no need to be dressing up the balance sheet; there is no need to be having extra issues.”

He also criticised the new role of Mr Pat Goodman as Goodman Fielder Wattie’s executive chairman, since the resignation of Mr Duncan McDonald as managing director when the bid was announced.

He said Mr Goodman had shown he was a determined and strongwilled businessman who liked to be in the controlling position but the jobs of chief executive and chairman would give him “absolute power.” Other corporate episodes had shown it was not good to have too much power in too few hands, he said. AMP is also a shareholder in lEL and Brierley Investments, Ltd, which has agreed to sell its stake in lEL and to buy lEL’s key asset, Wool-

worths, for SAustl.l billion.

Mr Hall said the deal was “absolutely splendid” for lEL and BIL. Both Messrs Hall. and Peacock said market action on Friday suggested a potential take-over bid for Goodman Fielder. Goodman Fielder Wattie shares jumped 11c to Aust2l7c, after dipping to 207 on news of the bid earlier in the week, but Mr Hall would not comment on whether AMP had been among the buyers. Speculation centres on John Spalvins’ Adsteam group as the buyer.

He is also rumoured to be behind some heavy trading in lEL, and is believed to have amassed almost five per cent of the company.

Goodman Fielder Wattie’s bid is conditional on 90 per cent acceptance for lEL shares, leaving room for a blocking strategy on the lEL register.

But some analysts believe Mr Spalvins may be angling for a deal with Goodman Fielder Wattie on Petersville Sleigh, an Adsteam group company with extensive food interests which is understood to be up for sale. Mr Spalvins is overseas and could not be contacted for comment.