The Australian soft drinks producer and bottler Coca-Cola Amatil is going to raise the price of its hostile takeover attempt of the water company Neverfail Springwater.
Providing it acquired 50.1% of Neverfail’s shares, Amatil says it will offer A$2.35 (US$1.56) per share.
The current offer stands at A$2.25 a share. The new offer represents a premium of about 37% over the volume weighted average sale price of Neverfail shares between February 26 and April 28. It is also a multiple of approximately 21 times earnings per share represented by Neverfail’s revised net profit after tax forecast of A$11m for the year ending June 30.
“In the absence of a competing offer, CC-Amatil will not raise its offer price for Neverfail above $2.35 per share,” CC-Amatil said.
So far Neverfail’s board has advised its shareholders not to accept Amatil’s takeover bid, which was launched in April.
It has also indicated that it is in negotiations with a potential rial bidder, although so far no one has been forthcoming.
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An independent expert’s report, commissioned by Neverfail and released last week, valued the company’s shares at between $2.49 and $2.89 per share.
