NZSE to explain Lion waiver
By Phil Boeyen, ShareChat Business News Editor
Shareholders who missed out on Lion Nathan's (NZSE: LNN) $4.65 Montana (NZSE: MON) offer should hear later today why the NZSE granted the brewer a waiver from the usual 48-hour period before standing in the market.
The waiver has been criticised by both Montana's independent directors and a number of market commentators who claim Lion's wine raid has left small shareholders in the lurch.
Commerce Minister Paul Swain has called the takeover a fiasco and is promising it won't happen once the new Takeovers Code comes into effect in July.
"That Takeovers Code will lay out an orderly process for companies to follow when staging a takeover.
There will be an independent Takeovers Panel which will oversee that process. No longer will the NZSE be judge and jury on takeovers," says Mr Swain.
Not surprisingly, Lion has supported being given permission to make a stand in the market last Friday rather than waiting until today.
The company's CFO Paul Lockey says he is surprised at the negative reaction to the waiver, particularly from Allied and Montana.
"Clearly the primary purpose of the Stock Exchange's rule is to ensure that the market is kept fully informed.
"In this instance, where the market has access to a current full appraisal report from PricewaterhouseCoopers and where the Montana Directors have recommended a competing offer of $4.40, it is difficult to see why Lion shouldn't be permitted to increase its offer to $4.65.
"We are also concerned at the suggestion from the independent Directors of Montana that the waiver has some way prejudiced Allied's ability to increase its offer.
"This is particularly difficult to understand given statements by Allied, both before and after the Montana comments, that it had no plans to increase its offer of $4.40."
On Friday Lion secured 18.2% of Montana off-market and this morning needed only another 4.5% to take its stake in the company to the majority 50.1% holding.
With thousands of sell orders in place the purchase of the extra shares is expected to be confirmed later today. Montana shares responded quickly to the expected outcome, dropping back to trade late morning between $3.50 and $3.70 - their lowest level since mid-November.
Lion attempted some appeasement of small shareholders by only offering to buy maximum parcels of 5,000 shares.
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