Reports in New Zealand have suggested that German corporation BayWa AG's NZ$137.4m bid to take over Turners & Growers (T&G) falls within independent adviser KordaMentha's valuation range, prompting independent directors of the fresh produce marketer to recommend that shareholders sell their holdings.
According to Business Desk, the NZ$1.85 per share offer from BayWa falls within KordaMentha's agreed valuation range of NZ$1.75 to NZ$2.10 per share.
BayWa's offer has already secured Guinness Peat Group's 64 per cent stake in T&G, meeting the minimum requirement to control half of the New Zealand business.
However, the valuer recommended that option holders should continue to hold unless the German group forces a mandatory sale by gaining 90 per cent acceptance for the takeover.
"The key benefits of the offer for minority shareholders are that the price is within our valuation range, albeit at the low-end of our range, and that it offers liquidity and a potential exit event for T&G shareholders," KordaMentha reported. "T&G's shares are very closely held and there is a lack of trading volume. This limits the liquidity available to T&G shareholders and their ability to exit."
KordaMentha added that T&G had been revaluing its land and buildings, with initial feedback suggesting that the group faced a 'significant writedown'.
"At the date of this report, T&G management have been unable to provide us with a reliable estimate of the impact of revaluing land and buildings but consider that it could lie in a range of NZ$20m-NZ$30m."