Chinese Synlait farm takeover granted extension

MARTA STEEMAN
Last updated 13:52 24/12/2013

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The Chinese takeover offer for Synlait Farms has been extended until January 29 to give more time for consents from the Government and Chinese authorities.

The bid was signalled on October 18 and launched in early November but is yet to receive approvals from the Government and the Overseas Investment Office.

The joint venture company making the takeover, SFL Holdings, 74 per cent-owned by a subsidiary of Shanghai Pengxin, has extended the closing date for its takeover bid from December 20 to January 29.

"SFL Holdings Ltd has determined to extend the closing date for the offer so as to allow sufficient time to seek the necessary regulatory consents from the NZ Overseas Investment Office and the relevant Chinese regulatory authorities," the company said.

The $2.10 a share offer remained conditional on obtaining those consents and on Synlait Farms continuing to be operated in the normal way.

Synlait Farms has 13 dairy farms around Ashburton in Canterbury covering about 4000 hectares.

The OIO said in late November that Associate Finance Minister Jonathan Coleman and Land Information Minister Maurice Williamson would make the final decision.

Shanghai Pengxin already owns 8000 hectares of New Zealand dairy farms after securing the Crafar farms in the North Island in late 2012.

The extension of the offer also results in a change to the "condition date" to February 28.

That is the deadline by which the regulatory consents conditions must be satisfied.

SFL said it was the last extension of the offer and the condition date was the latest allowed under the Takeovers Code without a waiver or consent from the Takeovers Panel.

If the regulatory consents have not been obtained by December 31, "as now appears likely", the price rise in the offer will apply, SFL said.

From January 1, if the offer is not unconditional, acceptors will receive an additional 0.19 cents a share a day.

Two of Synlait Farms founders, Juliet Maclean and John Penno, are taking a 16 per cent and 10 per cent stake respectively in the takeover vehicle, SFL Holdings.

SFL had received acceptances for 99 per cent of the shares and the offer was unconditional in respect of acceptance levels.

SFL said it intended to compulsorily acquire the remaining shares, assuming it achieved the remaining conditions.

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- Fairfax Media

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