Thursday 9th October 2014
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Just Water's founder and majority shareholder Tony Falkenstein has made a full takeover bid for the water cooler and supplies group, trumping an indicative offer from an international buyer.
Falkenstein, through his vehicle the Harvard Group, is offering shareholders 15 cents a share for the 29.3 percent of the firm he doesn't control, valuing Just Water at $13.42 million. His cash offer is a 36 percent premium to the last trading price of 11 cents, and ahead of a 14.6 cents per share conditional offer by the unidentified overseas buyer.
Chairman Paul Connell said the company engaged accounting firm PwC to examine potential interest from foreign and domestic parties, none of which progressed to the point where the board could recommend. The board has formed an independent committee to consider the offer.
"The Harvard Group Ltd's proposed offer price of 15 cents per share exceeds the highest effective price indication received and the offer terms signalled look to have a higher degree of certainty, and less conditionality than the alternatives," Connell said.
Falkenstein hit the headlines after being named in Nicky Hager's book 'Dirty Politics' as a target of Whale Oil blogger Cameron Slater at the behest of Food and Grocery Council boss Katherine Rich after he was named as the New Zealand contact for Australian lawyers considering a class action against cola companies in relation to the health impact of sugary drinks.
In a letter to the Just Water chairman, Falkenstein said his offer aims to give all shareholders the opportunity to sell at a fair price, though he won't stand in the way of a "clean higher offer for 100 percent of the company on acceptable terms."
If he's successful, he plans to run the company largely on existing lines, cutting costs and using surplus cash to reduce debt.
He stressed he is not in discussions with either the prospective overseas water-cooler company or the local party who wants to buy the assets, and leave the company as a shell.
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