Montana to take Corbans for $151M

By Phil Boeyen, ShareChat Business News Editor

Wednesday 20th September 2000

Winemaker Montana has confirmed it is to buy Corbans from brewer DB Group.

Montana will pay $151 million in cash for all DB's shares in the company. The figure includes the repayment of intra-group debt to DB. Montana will also take over around $3 million in Corban's bank debt.

The group managing director of DB, Brian Blake, says the bid maximises value for his company's shareholders.

"It completes DB Group's restructuring process and our focus is now to develop our core business."

The deal has already received Commerce Commission approval and preliminary consent from the Overseas Investment Commission. It is now subject to the approval of the shareholders of Montana Group and also to any consent required to be given by the DB Group shareholders.

Montana will pay for the purchase through bank debt, but over the medium term is planning an issue of capital notes.

The company says the acquisition provides a unique chance to merge the two most significant national wine companies into a larger and more internationally competitive company. It says the bigger company with its increased grape supply will be better able to fulfill Montana's unsatisfied export opportunities.

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