Takeover target still considering offer
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