AUS: Lion Nathan makes A$352 offer for Coopers
Lion Nathan today announced that it intends to make an off-market offer for Coopers Brewery Ltd (Coopers). The offer of A$260 per share in cash values Coopers at A$352m.
The Offer is not subject to a minimum acceptance condition and represents a 478% premium to the price of a buy-back conducted by Coopers of A$45.01 per share in 2003.
Coopers, an unlisted public company based in Regency Park, South Australia has approximately 117 shareholders, some of whom have approached Lion Nathan recently with a view to realising fair value for their otherwise illiquid holdings, Lion said.
At present the offer does not have the backing of the Cooper's management.
Rob Murray, chief executive Officer of Lion Nathan, said: "This is a very compelling offer for Coopers shareholders. Lion Nathan is hopeful of acquiring a significant shareholding in the Coopers business."
"We are offering a demonstrably fair price to acquire shares in Coopers and this is a reflection of the very high regard we have for the Cooper family, the brewery's management and the business and brands they have built."
"We will be comfortable with a range of shareholding outcomes which is why we have not set a minimum acceptance level. We expect any holding will be a good investment in its own right."
"Regardless of the outcome, our preference would be for the Cooper family and the management team to continue their close involvement with the business and we would welcome an appropriate Coopers representative on the Board of Lion Nathan, should Lion Nathan be successful in acquiring Coopers."
Murray continued: "Coopers has a number of quality brands including Coopers Original Pale Ale and Coopers Sparkling Ale. These brands are highly complementary with Lion Nathan's beer brand portfolio which includes Tooheys, XXXX, West End, Hahn, Heineken, Becks and James Squire."
"Thus, if full ownership were to result from the offer, Lion Nathan is well placed to continue to drive Coopers' growth nationally through Lion Nathan's extensive sales and distribution network."
Coopers' constitution currently includes three tiers of pre-emptive rights, which apply if a Coopers shareholder seeks to sell shares (other than to a relative). Lion Nathan has a third tier pre-emptive right in Coopers.
These rights were granted to Lion Nathan in 1995 in exchange for the 19.9% shareholding of Coopers that Lion Nathan owned following the purchase of the South Australian Brewing Company.
These third tier rights entitle Lion Nathan to purchase Coopers shares when shares are offered for sale but not acquired by existing shareholders or the Coopers' superannuation fund, and are the subject of a court challenge initiated by Coopers.
Lion Nathan is also currently in litigation with Coopers in respect of the share buy-back conducted by Coopers in 2003, which did not have regard to Lion Nathan's third tier pre-emptive rights.
A statement from Lion Nathan said that subsequent to the commencement of Coopers' litigation against Lion Nathan's pre-emptive right, Lion Nathan has explored with the Board of Coopers a joint venture and a proposal to acquire 100% of the shares of Coopers (also without a minimum acceptance condition).
"We are hopeful that the Board of Coopers will recommend acceptance of our offer to its shareholders. We would also expect its full co-operation in ensuring that Coopers shareholders have the opportunity to consider our proposal," said Murray.
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