Takeover tar­get still con­sid­er­ing of­fer

Townsville Bulletin - - Business -

THE board of takeover tar­get Evans & Tate Ltd is still con­sid­er­ing a $US20 mil­lion of­fer for the com­pany’s shares from USlisted wine groupYar­ra­man Win­ery Inc.

The com­pany said its board met yes­ter­day and dis­cussed the of­fer, which was re­ceived last Thurs­day.

‘‘The board notes that it is not bound by the Yar­ra­man of­fer, and in­tends to fully con­sider and eval­u­ate the of­fer and pro­vide its view of the of­fer in due course,’’ it said.

‘‘The board has nei­ther ap­proved nor dis­missed the of­fer.’’

Yar­ra­man is of­fer­ing share­hold­ers one share for ev­ery nine Evans & Tate shares, valu­ing the tar­get’s listed stock at about $25.5 mil­lion.

In­clud­ing debt, pref­er­ence shares and con­vert­ible notes the of­fer is worth about $131 mil­lion.

Yar­ra­man yes­ter­day wel­comed Evans & Tate’s an­nounce­ment and said it be­lieved the of­fer was a very good one.

It has re­quested a for­mal re­sponse to its pro­posal by Jan­uary 16.

Yar­ra­man last week be­came the com­pany’s largest share­holder through the pur­chase of a 19.9 per cent stake.

Yar­ra­man pur­chased its stake from Grape Ex­pec­ta­tions En­ter­prise Pty Ltd, a com­pany owned and con­trolled by for­mer Evans & Tate ex­ec­u­tive chair­man Franklin Tate.

Mr Tate, who is an ex­ec­u­tive di­rec­tor of the group, stepped down as ex­ec­u­tive chair­man this year af­ter the com­pany posted a $64 mil­lion loss in 2005/06, a year de­scribed by the com­pany as a ‘hor­ror year’.

A tough United King­dom mar­ket, re­struc­tur­ing costs and Aus­tralia’s wine glut took its toll on the trou­bled wine­maker.

Evans & Tate shares ended un­changed yes­ter­day at 23 cents.

Yar­ra­man is propos­ing a scheme of ar­range­ment that would al­low the two groups to com­bine un­der a par­ent com­pany trad­ing in Aus­tralia and the United States.

LOSS . . . for­mer Evans and Tate ex­ec­u­tive chair­man Franklin Tate at the Mar­garet River win­ery in WA

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