Editor's Viewpoint - No Starting of Engines for Treasury Wine Estates
Kohlberg Kravis Roberts & Co and Rhone Capital have submitted an improved takeover offer for Treasury Wine Estates
With Kohlberg Kravis Roberts & Co returning to Melbourne with an improved offer for Treasury Wine Estates, and the Australian wine company not slamming the door this time, the future for Treasury looks pretty sealed down.
Earlier today, TWE confirmed that KKR has teamed with fellow private equity firm Rhone Capital and proposed an offer of AUD5.20 per share - a AUD0.50 per share premium on KKR's solo offer back in May. TWE has subsequently opened its vaults and allowed the two companies due diligence - that's “non-exclusive due diligence”, as TWE was at pains to point out this morning.
That KKR's initial move almost three months ago has not flushed out any other runners and riders would suggest quite clearly that there aren't any. And yet, that TWE has highlighted that other companies could conduct due diligence were they to make a similarly-priced counter-offer, looks like one final sweep of the dancefloor before giving up for the night.
While noises earlier this year suggested interest for TWE's US operations - firstly Pernod Ricard was linked, then Constellation Brands - a combination of the lack of any other interested parties and that the existing offer proposes a clean, full sale rather than a messy hiving off of individual units, means that - to me - Treasury will find itself under the aegis of private equity quite soon.
I imagine Treasury employees will be calling up their peers at Accolade Wines and taking them for a quiet drink in the coming days.
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