‘Real potential’ spurs $438m bid
A $438 million takeover bid has been made for poultry business Tegel by a Philippines-based company that says Tegel has ‘‘real potential’’ to expand offshore.
Tegel Group Holdings’ largest shareholder, Singapore-based Claris Investments, has agreed to sell its 45 per cent stake to Bounty Fresh Group at $1.23 a share, a 50 per cent premium on the last traded price of $0.82.
Bounty Fresh Food president Tennyson Chen said the company planned to acquire 100 per cent of Tegel shares.
‘‘Tegel is a leading brand in the New Zealand market with real potential to expand into international markets, particularly the Philippines where Bounty Fresh Group’s sales and distribution networks are extensive,’’ Chen said.
Bounty Fresh operates a farmto-market strategy, meaning it controls and manages the entire supply and production chain.
It also has operations in egg production, hog farming, feed milling and the takeaway segment in the Philippines. In the past six years it has established more than 1500 company-owned takeaway stores under three brands.
Chen said the offer was ‘‘motivated by a desire to further grow the Bounty Fresh Group beyond the Philippines’’.
Bounty Fresh’s offer valued Tegel at about $438m.
After the takeover announcement, Tegel’s share price rose from $0.82 to $1.15, later easing to $1.12.
Tegel reported annual revenue of $614m in 2017.
Bounty Fresh’s offer is contingent on a minimum shareholder acceptance condition of more than 50 per cent, steady reported earnings, and Overseas Investment Office approval because of ‘‘sensitive land’’ held by Tegel.
Bounty Fresh’s 2017 annual revenue was more than $750m.
Claris Investments is owned by Hong Kong-based Affinity Equity Partners, the equity firm behind footwear retailer Colorado Group, which it put into receivership in 2011 and later rebadged as Fusion Retail Brands.