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

 

Australia's GWA lobs in $118M bid for Methven


By Paul McBeth

Dec. 14 (BusinessDesk) - Australian kitchenware firm GWA Group is mounting a $118 million bid for Kiwi tapware maker Methven and has the blessing of cornerstone investor Brendan Lindsay, barring a better offer emerging.

Methven's directors have agreed to a scheme implementation agreement in which GWA would pay $1.60 a share, a 39 percent premium to the $1.15 price before the deal was announced today. Since trading resumed, the shares have climbed 23 percent to $1.41. GWA would also let Methven pay an interim dividend of up to 5 cents from profits in the six-month period ending Dec. 31.

The New Zealand firm's directors are obliged to unanimously recommend the offer, provided it falls within the assessed valuation range of independent adviser Grant Samuel, and provided no superior bid emerges. The agreement includes a $1.2 million break fee, the equivalent of 1.6 cents per share.

GWA already has Methven's biggest shareholder - Sistema millionaire Lindsay - onboard, giving it 19.9 percent. Another 2.1 percent will be committed by the directors, meaning the Australian firm starts at 22 percent.

To secure control, it only needs 75 percent support at a meeting where at least half the company's voting rights are cast, rather than the 90 percent threshold needed in a formal takeover to enforce mop-up provisions. The meeting is expected to be held in March next year.

"The value offered, which includes the permitted dividend, is highly attractive as it does acknowledge future growth in Methven and allows shareholders to realise value today," chair Alison Barrass said in a statement. "Given there was a high level of understanding between both parties, a scheme proposal was seen as the best and fairest way of expediting this transaction and providing certainty of outcome within a defined timeframe at an agreed and compelling value."

Methven said GWA has committed to keeping the New Zealand design, innovation and manufacturing base for the enlarged group. That was a crucial element of the deal, it said.

GWA said it expects to cut duplicated costs by about $5 million by the 2021 financial year, primarily in logistics, freight, and listing costs. It sees the deal as boosting per-share earnings by a mid-single digit in the 2020 year, rising to a high-single-digit gain once the doubled up costs are stripped out.

The Australian company will fund the deal from its existing banking facilities.

"The transaction will enhance the regional diversity of our revenue and earnings through leveraging Methven's presence in international markets to accelerate growth opportunities for Methven and GWA brands aligned to our core water solutions," GWA managing director Tim Salt said. "The combination of GWA and Methven will create a stronger trans-Tasman business, which will allow us to strengthen our offering in bathroom and kitchen fixtures."

GWA last traded at A$2.77 on the ASX, and has decreased 2.8 percent so far this year.

The scheme also needs High Court approval, and the transaction will require Overseas Investment Office sign-off.

(BusinessDesk)

ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Stats NZ: Largest Drop In Terms Of Trade In A Decade As Dairy Export Prices Sour

Lower export prices for dairy, meat, and logs in the September 2020 quarter led to the biggest drop in terms of trade since June 2009, Stats NZ said today. Export prices fell in the September 2020 quarter, down 8.3 percent from its highest ever ... More>>

ALSO:

Stats NZ: Election Boosts October Job Numbers

Job numbers were boosted by general election staff in October 2020, along with rises in the manufacturing, retail, and hospitality industries, Stats NZ said today. Filled jobs rose by 27,667 to 2.2 million in October 2020 compared with September, after ... More>>

Government: New Year Border Exception For Seasonal Workers In The Horticulture And Wine Industries

2000 additional RSE workers to enter New Zealand early next year employers must pay these workers at least $22.10 an hour employers will cover costs of managed isolation for the RSE workers RSE workers will be paid the equivalent of 30 hours work a week ... More>>

ALSO:


Media: Discovery, Inc. Completes Acquisition Of New Zealand’s Mediaworks TV Ltd

Auckland, New Zealand, December 1, 2020 - Discovery, Inc. (“Discovery”), the global leader in real-life entertainment, has completed its acquisition of New Zealand’s leading independent free-to-air commercial broadcaster, MediaWorks TV Ltd, now operating ... More>>

Department Of Conservation: Big Year Underway At Albatross Colony

Familiar faces are returning for the new season of Royal Cam, with a big breeding year underway for the toroa/northern royal albatross colony on Otago’s windswept Pukekura/Taiaroa Head. More than 120 albatrosses, a taonga species, have returned ... More>>

Real Estate: ASB Survey Reveals Majority Of Kiwis Expect House Prices To Keep Climbing

ALSO:

House price expectations are soaring as New Zealand’s housing market shifts up a gear. But stretched affordability is putting a dent in perceptions of whether it’s a good time to buy. While Kiwis reveal they do expect interest rates to fall further. ... More>>

Stats NZ: Births And Deaths: Year Ended September 2020

Births and deaths releases provide statistics on the number of births and deaths registered in New Zealand, and selected fertility and mortality rates. Key facts For the year ended September 2020: 57,753 live births and 32,670 deaths ... More>>

ALSO: