Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Dorchester Pacific to bid $3/share for Turners Auctions

Dorchester Pacific to bid $3/share for Turners Auctions, wins support from chairman

By Jonathan Underhill

July 28 (BusinessDesk) - Dorchester Pacific plans to offer $3 a share in cash, shares and notes for Turners Auctions, valuing the auction company at $82 million, after winning support from chairman and major shareholder Michael Dossor.

The offer would amount to a 9.1 percent premium on the most recent trading price of Turners of $2.75 and Dorchester said it would also require Turners to pay a fully-imputed special dividend of 15 cents a share once it has acceptances that would give it more than 50 percent of the company. Dorchester currently owns 19.85 percent of Turners while the target company's chairman owns 20.8 percent through Bartel Holdings, for a combined 40.65 percent stake.

Dorchester said it will offer either $3 a share cash, two-year notes that pay interest of 9 percent and convert to Dorchester shares. ordinary shares of Dorchester or any combination. Bartel, which has entered a lock-up agreement with Dorchester, has agreed to accept 60 percent ordinary shares and 40 percent convertible notes, the finance company said.

Dorchester said the takeover was conditional only on achieving at least the 50.1 percent control required under the Takeovers Code.

"There is a natural alignment and synergy between Dorchester and Turners Auctions, which we talked about at the time of our investment in Turners," Dorchester chief executive Paul Byrnes said. "Seventy percent of our finance lending is for motor vehicles and our insurance business has a focus on motor vehicle related insurance products."

Turners stock was put in a trading halt. Dorchester rose 4.6 percent to 23 cents and is little changed this year.

Dorchester expects to raise between $25 million and $27.5 million by selling shares at 25 cents a piece to Turners stockholders including Bartel and via a placement, it said. It also expects to issue about $15 million of convertible notes to Bartel and other parties, it said. Final details would depend on what combination of cash and securities that Turners' shareholders accepted.

Dorchester plans to make a formal takeover offer in August, with resolutions relating to the proposal put to the company's annual meeting.

A successful takeover may lift Dorchester's 2016 pretax earnings to between $20 million to $25 million, from a forecast $10 million to $11 million forecast for the current year from existing businesses, it said.

Dorchester chairman Grant Baker said after the transaction, its balance sheet "will still remain relatively conservative," giving the company room to pursue further acquisitions.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Reserve Bank: Wheeler Keeps OCR At 1.75%

Reserve Bank governor Graeme Wheeler kept the official cash rate unchanged at 1.75 percent, as expected, and reiterated his view that the benchmark rate doesn't need shifting for the foreseeable future. More>>

ALSO:

Retail: Pumpkin Patch Brand, IP Sold To Catch Group

The receivers of failed children's clothing retailer Pumpkin Patch have confirmed that the company's brand and intellectual property have been sold to Australian online retailer Catch Group. More>>

ALSO:

Oil: 2017 Block Offer Petroleum Tender Launched

New Zealand is well-placed to take advantage of the economic benefits of oil and gas exploration, Energy and Resources Minister Judith Collins announced today at the launch of the 2017 Block Offer petroleum tender. More>>

ALSO:

OECD And Zero Carbon Reports: Environmental Pressures Rising In New Zealand

New Zealanders enjoy a high environmental quality of life and access to pristine wilderness. However, New Zealand’s growth model, based largely on exploiting natural resources, is starting to show its environmental limits with increasing greenhouse gas emissions and water pollution ... More>>

ALSO:

Statistics: Record Net Annual Migration Levels Continue

In the February 2017 year, 71,300 more migrants arrived in New Zealand than left, Stats NZ said today. This equalled the previous annual record set in January 2017. More>>

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news