Fisher & Paykel Appliances' independent directors says shareholders should accept an increased takeover offer from China's Haier, which through acceptance from some institutional investors, now has more than 50% of F&P Appliances' shares.
Haier has increased its offer to NZ$1.28 per share from its initial offer of NZ$1.20 per share. The NZ$1.28 price is at the bottom of the NZ$1.28 to NZ$1.57 per share valuation range in Grant Samuel's independent report on the Haier offer.
Major shareholders, including AMP Capital Investors, the Accident Compensation Corporation and Harbour Asset Management, representing about 14.1%, have now committed to accepting the NZ$1.28 per share offer from Haier. This is in addition to Haier, which started as a 20% shareholder itself, previously getting support from second largest F&P Appliances shareholder, Allan Gray, for its 17.5%. Haier now holds 51.95% of the New Zealand company.
“This means that with Haier’s existing 20% shareholding, Haier will achieve its minimum acceptance condition of more than 50% of the voting rights of F&P Appliances and will gain a controlling interest in the company when the offer becomes unconditional," chairman Keith Turner said.
“Directors acknowledge that some market commentators believe that should Haier’s offer close without Haier having reached 90% acceptances, F&P Appliances shares will trade lower than the increased offer price of NZ$1.28.”
Turner said shareholders should consider Haier’s increased offer in the context of their own circumstances and should consult their professional advisors.
Directors and senior F&P Appliances officers who hold shares will accept the increased offer. Shareholders have until November 6 to accept the increased offer, unless Haier extends it.
Haier has previously suggested it might sell whiteware maker F&P Appliances' consumer finance business, F&P Finance, should it gain control of F&P Appliances, which it has now done.
The independent directors are Turner, Philip Lough, Lynley Marshall and Bill Roest.
Meanwhile, Liang Haishan, chairman of Haier New Zealand Investment Holding Company and president of Haier White Goods Group, said the support of the independent directors for Haier's increased offer was "very valuable" and it was important for Haier to proceed with their full support.
“While we differ with the valuation provided by the Independent Adviser, we are pleased to indicate our intention to provide an increased offer price to within the valuation range. We feel this allows our offer to move forward on a positive basis," said Liang.
At NZ$1.28 per share, the offer represents a 71% premium to F&P Appliances' pre-offer share price.
The offer remains subject to certain regulatory approvals, including from the Overseas Investment Office.
(Update adds comments from Haier).