Takeover virtually a done deal

19:50, Feb 10 2013

Australian wool merchant Lempriere is just a whisker away from reaching the 90 per cent shareholding it needs to take over New Zealand's biggest wool exporter, Wool Services International.

WSI Holdings, an associate company of Melbourne-based, family-run Lempriere, told the NZX yesterday that it had acceptances for 89.87 per cent of the shares in Wool Services International. If it secures 90 per cent of the shares, it can compulsorily acquire the company's remaining shares, and would then delist Wool Services International.

WSI Holdings made a formal offer of $31 million or 45c a share to Wool Services shareholders in October last year, having already secured 75 per cent of Wool Services International shares through pre-bid "lock-up" agreements with the receivers of Allan Hubbard- associated companies, Plum Duff and Woolpak Holdings, Wool Services managing director Michael Dwyer, and some senior employees, for 45 cents a share.

That price would give the receivers of Plum Duff and Woolpak Holdings $19,974,726 for their 64 per cent stake in Wool Services.

An independent adviser's report by Northington Partners put the full underlying value of Wool Services' shares between 38c and 47c a share. Wool Services shares last traded at 42 cents a share. The offer closes on February 24.

Lempriere has signalled it intends to run Wool Services International as is, and does not plan on selling its wool scouring operations.

An earlier bid by Cavalier Wool Holdings to gain control of Wool Services' wool scours would have, if successful, given Cavalier a monopoly over the wool scouring industry in New Zealand.

The takeover is subject to approval from the Overseas Investment Office (OIO), and two conditions relating to obtaining certificates from Apex Environmental Ltd. Fairfax NZ


Taranaki Daily News