Crane bid 'unreasonable', Fletcher mulls options

Fletcher Building, New Zealand biggest construction company, is mulling options after takeover target Crane Group released excerpts of an independent review of the hostile bid, which labeled it "not fair and not reasonable".

In a statement released by Australian company, Ernst & Young Transaction Advisory Services is quoted as saying fair market value was in the range of A$9.92 to A$11.56 per share, on a controlling and ex-dividend basis, but the fair market value of Fletcher's cash-and-scrip offer was in the range of A$9.05 to A$9.45 per share.

The ASX-listed building and industrial products company has previously rejected the A$3.47 and one Fletcher share offer, which values Crane shares at $9.35 apiece.

"We've only seen a snapshot with some figures, so until we see the full report and the assumptions that they used to generate their valuations it's difficult to say anything," Philip King, general manager for investor and media relations at Fletcher, said.

The full report is expected to be available next week when Crane releases its target statement to shareholders.

Fletcher is still seeking clearance for the deal, which is currently before the Commerce Commission and a spokesman was reported today as saying antitrust concerns may not derail the deal.

"We see nothing in public description of the process that would worry us,"
King said. "All they are really doing is following through with due processes."

Crane shares rose 0.6 per cent to A$9.58 on the ASX, a 2.5 per cent premium on Fletcher's offer, while Fletcher rose 0.4 per cent to $7.93.