Whatever happens, Fletcher Challenge Forests shares that traded around $1 last June have now had a 62.5c payout, been halved in number, and are fetching $1.87 as Tenon shares. It is a 53 per cent gain.
Rubicon, a box of assets left over from the Fletcher Challenge breakup, is trying to move from owning 19.9 per cent of Tenon to 50.01 per cent, with the support of its major shareholder, Guinness Peat Group.
The Grant Samuel report on the bid warns that the Rubicon offer is highly conditional and pays no premium for control. It questions the value of an opt-out offer to shareholders and reveals that the company could recover $70 million from a court action against Inland Revenue, effectively an undisclosed contingent asset.
The report found no evidence of undisclosed liabilities from Fletcher's past.
Tenon's independent directors recommended that shareholders reject the offer.
Rubicon chief executive Luke Moriarty said the report was muddled, confused and short of substance.
"In any case the market has determined that it is largely irrelevant because the share price has fallen."
Grant Samuel was critical that US-based shareholders are cut out of the bid. Also, because it is partial, shareholders can be scaled back.
Tenon's biggest institutional shareholder, AMP Capital Investors, continues to assess the situation and spokesman Nat Vallabh said the Grant Samuel valuation was in line with its own.
The report said board papers suggested that Rubicon directors Moriarty and Michael Andrews had not objected to existing strategies or presented alternatives.
Tenon's assets include sawmills at Kawerau, Rainbow Mountain and Taupo, a plywood mill at Mt Maunganui, a remanufacturing plant at Kawerau and a mouldings plant at Taupo.
Valuing Tenon
Grant Samuel report: $2.01 to $2.22 a share
Rubicon offer: $1.85 a share
Market price: $1.86 a share
Grant Samuel and Associates (commissioned by Tenon):
Independent Adviser's Report on a Partial Takeover Offer from Rubicon Forests Limited
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