Aussie wool offer fairly compelling - report

TAMLYN STEWART
Last updated 05:00 27/11/2012

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An independent report has described a takeover offer by Melbourne wool merchant Lempriere Holdings for all the shares in New Zealand's largest wool exporter as "reasonably compelling" for shareholders.

WSI Holdings, an associated company of family-run Lempriere Holdings, made a formal offer of $31 million or 45c a share to New Zealand Wool Services International shareholders last month.

WSI Holdings has already secured 75 per cent of Wool Services' shares through "lockup" deals with the receivers of two Allan Hubbard-associated firms, which hold 64 per cent of WSI, and senior Wool Services managers, with another 11 per cent.

Wool Services released a statement on Friday saying the board had received the independent report from Northington Partners Limited which found the offer was "reasonably compelling" for minority shareholders.

The independent directors of Wool Services would accept the offer for their own shares and recommended that shareholders do the same.

WSI Holdings has signalled it will not sell the company's scouring assets to rival Cavalier Wool Holdings, which last year bid $40m to acquire the scouring assets of Wool Services. If successful, Cavalier would have gained an authorised monopoly over the Kiwi wool-scouring industry.

The offer documents and the response from Wool Services will be posted to shareholders next week and include full details of the independent directors' reasons for their recommendation.

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- BusinessDay.co.nz

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