By Christine Nikiel
Friday 4th July 2003
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And while some analysts said $130 million company PRG would have difficulty raising twice that to fund the deal, a source suggested PRG had "help" to finance its bid.
The source questioned whether the rumour PRG was pulling out was a smokescreen. "With a deadline looming, wouldn't you want other bidders to think you had pulled out so they would lower their offers?" he said.
Monday is the deadline for final bids.
PRG, 73% owned by Eric Watson, has been a frontrunner in the race to buy the 64-store Farmers retail chain and its $300 million finance company.
Another possible scenario is a Farmers' management buyout, expected to be led by Farmers chief executive and former PRG head, Nick Lowe, and backed by a merchant bank or Fisher & Paykel Appliances, one of Farmers' biggest whiteware suppliers.
Grant Samuel's GS Private Equity is understood to still be in the game looking at a joint venture with a partner and Australian fund Castle Harlan Australian Mezzanine Partners (Champ) Group has also been said to be a contender.
PRG, which has a market capitalisation of $130 million, is said to have put in an out-of-the-blue offer of $260 million for Farmers last year before the formal sale process which was turned down.
ABN Amro, the broker handling the sale, said it hoped for an announcement on the sale before the end of this month.
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