If the Takeovers Panel this week thinks Saputo Inc will go along meekly with its orders it may be in for a rude shock. Canada’s biggest dairy company is prepared to appeal for a review process if it doesn’t like the Takeovers Panel decision.
Montreal-based Saputo would prefer the Takeovers Panel enter discussions with it before issuing orders that could potentially force changes in the terms and conditions of its bid for Warrnambool Cheese and Butter Factory Ltd.
The Takeovers Panel has the power to make Saputo comply with its orders but the orders, which may be given to Saputo by Friday, can be reviewed if Saputo wishes. Still, any orders from the Takeovers Panel, even after a review process, can be enforced by a court.
Saputo has written to the Takeovers Panel rejecting Murray Goulburn Co-operative Ltd’s argument that it has changed the terms of its bid.
The Victorian dairy cooperative argues Saputo on November 15 had a Warrnambool takeover bid of as much as $9.56 – $9 cash plus 56 cents in fully-franked special dividends. On November 25, Murray Goulburn claims, Saputo changed its Warrnambool offer to $9 cash per share without the dividends. This change in the value of Saputo’s offer between November 15 and 25, says Murray Goulburn, may contravene truth in takeovers.
“Warrnambool shares traded from 15 to 25 November 2013 on the basis of misinformation as to the terms of the Saputo bid, namely that Warrnambool shareholders would contingently receive franking credits of up to $0.56 per share,” Murray Goulburn says in its Takeovers Panel submission.
Saputo says it never valued its Warrnambool bid at $9.56 a share, a figure that was given credence by journalists who were misinformed by its rivals Murray Goulburn and Bega Cheese Ltd, who are also seeking to buy the Victorian cheese and butter producer.
Saputo’s stake in Warrnambool is now 13.55 per cent. This shareholding Saputo says, was accumulated after November 25 when firstly Warrnambool executives and directors sold their shares to Saputo before other Warrnambool shareholders followed suit.
Warrnambool shares have more than doubled to $9.18, as of 1229 AEST, since Bega launched the first bid this year for Warrnambool on September 12.
The Australian Securities and Investments Commission has written to the Takeovers Panel on Saputo’s Warrnambool bid and its views will be taken into account by the panel.
Source:Business Spectator