Monday 10 October 2016 02:43 PM
Bapcor's takeover tilt delays Hellaby boardroom refresh, chairman Smith says
By Paul McBeth
Oct. 10 (BusinessDesk) - ASX-listed Bapcor's $322.5 million takeover bid for Hellaby Holdings has delayed the NZX-listed company's plans to freshen up its boardroom, chairman Steven Smith has told shareholders at its annual meeting in Auckland.
The Auckland-based company has delayed the appointment of two new directors, who were picked to increase Hellaby's diversity and provide experience in the resource services sector to let the current board deal with a hostile takeover they say is opportunistic and undervalues the business, Smith said. Independent director Gary Mollard intended to retire from the board at the end of today's meeting but has agreed to a temporary appointment until the outcome of the takeover is known.
"The current circumstances are such that it is appropriate to defer these director appointments, as the current board and management manage the takeover process," Smith said in speech notes published on the NZX. "The director candidates are understanding of this and remain very keen to join the Hellaby board, and to contribute to the evolution and implementation of the Hellaby strategy."
Hellaby has told shareholders to wait until they see an independent report by Grant Samuels to weigh up the merits of the $3.30 a share offer, which has secured almost 30 percent through lock-up deals with Salt Funds Management, Accident Compensation Corp and Hugh Green Holdings’ Castle Investments.
Smith said Hugh Green has been a very supportive shareholder over the past two decades, though its circumstances have changed since the death of its principal in 2012 and litigation over the control of the trust.
"It is important to note that directors take their responsibility seriously to act in good faith and the best interests of the company," Smith said. "In the current circumstances, this means to consider the interest of all shareholders, to maximise value for shareholders, and to extract full value for any assets sold."
Bapcor approached Hellaby earlier this year to buy the automotive business which was turned down, with the New Zealand company's board viewing the unit as "a very valuable and important part" of its new investment strategy, which has seen it shrink its focus to being a long-term investor in the automotive and resources services sectors.
The shares increased 0.3 percent to $3.34, above the offer price. Bapcor chief Darryl Abotomey hasn't ruled out lifting the bid.