City Forests Limited - Takeover Offer
City Forests Limited
6 October 2004: City Forests Limited announced today that its 85c per unit cash takeover offer for Opio Forestry Fund is now unconditional.
City Forests’ chief executive Mr Phil Taylor said: “The decision to make the offer unconditional at this point is to give certainty to all those unitholders who have accepted that they will get 85c per unit cash.
“We have no doubt that if we simply walked away from this offer the Opio price would slump back to its previous trading range of between 44 and 60 cents,” he said.
“Our action also provides certainty of outcome for anyone who may currently be reviewing their options with respect to our very attractive offer.”
City Forests’ offer closes on 8 October 2004. It currently has acceptances for 6,581,172 units in Opio representing 44% of the total units on issue. This includes eight out of the top 10 unitholders. City Forests is able to go unconditional at 44% because Opio is not a code company for the purposes of the Takeovers Code and is exempt from the Takeover provisions of the NZX listing rules. “Though we are still very hopeful of reaching our previously stated minimum 75% acceptance target, we are very pleased with the response we have achieved so far especially in light of the level of frustrations we have encountered since launching our offer on 3 August 2004,” Mr Taylor said. The Trustee for Opio has refused to provide access to the register of unitholders and this has restricted City Forests from communicating with unitholders in the way it would have liked to.
“What ever level of acceptance we finally achieve our decision to go unconditional means that we will be Opio’s largest unitholder,” Mr Taylor said, adding that without City Forests support there was no certainty that the Opio price would remain at 85c once its offer closed.
City Forests firmly believes that its 85 cents per unit cash offer provides unitholders with a very attractive and certain exit price.