The takeover tussle for New Zealand Farming Systems Uruguay has intensified. First-offerer Singapore-based Olam had received Overseas Investment Office approval, while zeroing in on its 50.1% target.
However, the play for control of NZFSU may go in one of several directions yet. An unnamed third party is yet to disclose a non-takeover equity offer, increased offers from the two takeover parties are possible, and any of the parties could be forming a 10% blocking stake to stop another gaining 100% control.
Shares in NZFSU were sitting at 72c yesterday; above the 70c offer of Olam as investors anticipated counter-offers would materialise.
Earlier this week, Olam boosted its initial takeover offer 27% from 55c per share to 70c per share, eclipsing that of Uruguayan-based Union Agriculture Group's 60c offer last week. Olam subsequently bought the 7% stake held by the Accident Compensation Corporation (ACC).
With a 37% stake, to go unconditional Olam now needs only to receive further acceptances of 13%.
Craigs Investment Partners broker Peter McIntyre noted Union Agriculture Group also had to gain Overseas Investment Office approval, and was similarly seeking at least a 50.1% stake in NZFSU.
"Olam are in the driver's seat. They front-footed with the first offer and have the highest bid at the moment," Mr McIntyre said.
Shareholders agreeing to any offer at present would receive any subsequent higher offer from that party.
