Forum Archive Index - March 2002

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

You've read the 'Out West' version of what is happening.  But as the 
buyout deadline looms, and having now read the detail of the 
independent report, I feel compelled to making a few more pertinent 
comments.

I feel very disappointed in the behaviour of the board since 
the Venter/AMP consortium made their initial offer for the company.

Far from worrying about corporate governance and the future of 
Bendon, the board seems to have turned into a collective auctioneer 
sitting back and waiting for the highest bid to emerge, safe in the 
knowledge that their golden parachutes will likely provide *them* 
with a big payout whoever the successful suitor is.

It seems that the relationship between Venter and the rest of the 
board has gone from being edgy to completely dysfunctional.   It is 
frustrating to me as a shareholder to see the management talent 
(Venter/McPherson) squaring off against the money team (Eric and 
Nicky Watson), whereas it seems to me that they should be working 
together.

Reading between the lines it would seem the Venter consortium doesn't 
have the money to mount a 'proper' bid for the company.  According to 
the Interim Report just out, Venter has cashed up his share options.  
 These are hardly the actions of a man who is flush with cash wanting 
to make a bid for the company.  Given that the Venter consortium has 
made a second piecemeal bid in the full knowledge that it was a full 
bid the board wanted, I can't come to any other conclusion.   
And given that Venter is already on record as saying that he feels 
the company would run better as a delisted private fashion house it 
is hard to see how he can continue on in his present role, should the 
Watson's gain control of the company.  I am predicting Venter will be 
gone within three months and maybe Elle McPherson too.   This will 
leave the UK growth strategy in tatters and the Watson's bargain buy 
perhaps not the bargain they thought.

Initially I was aggrieved that the Watson offer of $1.90 was below 
fair value for the company.   Upon reading the independent report I 
now understand why.  The takeover premium suggested assumed some 
built in synergies for whoever bought Bendon.  In the case of Pacific 
Retail group, there don't seem to be any.  So it isn't surprising 
that Eric Watson has refused to pay over the odds for synergies he 
will never receive.

I was very disappointed with the way the board are recommending 
selling out at a price less than fair.   However, I now see it as 
fair as, due to the boards actions, putting a rift between the 
management and the financing, they have reduced the value of the 
company to match the offer!  It has been a disgraceful display of 
self serving ineptitude by the board IMHO.  Reluctantly I am now 
readying my parachute to take a dive with the board.  Unfortunately 
my own parachute is not lined with gold :-(.   

The plane is now on the runway and the Bendon shareholders have their 
parachute packs on their backs.   I can only hope that Eric Watson 
does not get to read this and call off the flight at the last minute.
When the management bunfight after the takeover happens, I don't want 
to be there.  

A very annoyed SNOOPY



disclosure: Bendon shareholder


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