AUS/US: Evans & Tate to mull Yarraman bid
The Evans & Tate board of directors will meet in the next week to consider a takeover bid from US-listed Australian wine group Yarraman Winery.
Evans & Tate said today (21 December) that it would make an announcement on Yarraman's proposal before trading on the Australian Stock Exchange restarts on 27 December.
Yarraman, which is listed on the NASDAQ but has vineyards in Australia's Upper Hunter valley, made a full bid for Evans & Tate after snapping up a 19.9% stake in the West Australian wine group.
Yarraman bought the stake from Grape Expectations Enterprises, a company linked to former Evans & Tate executive chairman Franklin Tate, who was relieved of his position last year.
Evans & Tate has had a tough 18 months, announcing a series of losses, write-downs and winery sales as the business was hit by Australia's wine glut.
Reports suggested that Yarraman had tabled a A$20m (US$15.7m) bid for Evans & Tate but officials at neither company were available for comment.
Yarraman has offered Evans & Tate investors one share in the company for every nine shares. Yarraman has also offered to refinance Evans & Tate's debts, which stand at around A$90m.
Yarraman CEO Wayne Rockall believes the deal would strengthen both businesses. He said: "Evans & Tate is Australia's sixth-largest wine producer and we believe freeing the business from its onerous debt and strengthening the company would be a major positive for the Australian wine industry."
Under Yarraman's proposals, Evans & Tate chief executive Martin Johnson would become president and CEO of the enlarged group, which would be named New World Wine Estates. Rockall would take up the position of senior vice president of sales and marketing.
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