ABN bid means keep on truckin'

By DANIEL RIORDAN transport writer

The likely new owner of Freightways Express says it is "very comfortable" with the business and is in no rush to change the way the company operates.

ABN Amro Capital has made a cash offer for Ausdoc, Freightways' Australian Stock Exchange-listed parent. ABN is offering Ausdoc shareholders A$2.13 a share plus 2Ac a share in recognition of money from the sale of Ausdoc subsidiary DX Group, and the net costs of closing another subsidiary, GoMail. Ausdoc is selling DX Group to Toll Holdings.

Some 2800 New Zealanders own preference shares in Freightways, whose business units include NZ Couriers, Post Haste Couriers, Sub60 and DX Mail.

No offer is being made for these shares.

ABN Amro Capital's JP Kaumeyer is not giving much away.

The head of the investment bank's Australian private equity business said more details of the offer would be released to shareholders in a bidder's statement, probably within the next 10 days.

These would include ABN Amro's long-term plans for its new assets.

"Once we get in and assess the company's prospects, we'll make up our mind how to proceed with it."

ABN Amro was asked to make a bid, along with several other parties, by Ausdoc's advisers, UBS Warburg, last December.

It was one of the few examples where a financial buyer was invited to take part in the sales process and conduct due diligence on a publicly listed company, Kaumeyer said.

ABN Amro Capital established its Australian operation two years ago, and has investments in three companies worth A$35 million ($40.68 million). The deal is its biggest and the first time it has bought a public company and taken it private.

Freightways managing director Dean Bracewell said his company had operated autonomously under Ausdoc's ownership for 4 1/2 years. He expected it to be business as usual under the new owner.

Ausdoc's directors, who own 14 per cent of the firm, recommend that shareholders accept the offer.

The price represents a 32 per cent premium to the one-month volume weighted average price of A$1.63 a share for Ausdoc shares to the close of trading on December 19, the day before the start of Ausdoc's sale process.

Ausdoc shares closed yesterday at A$2.10, 17Ac higher than a week ago.

Kaumeyer said he was comfortable with the investigation into the bid by Australian regulatory authorities.

The Australian Securities and Investments Commission asked Australia's Takeovers Panel to investigate Ausdoc's negotiation arrangements with ABN Amro.

Ausdoc agreed to pay ABN Amro "break fees" of up to A$3.5 million if a bid was launched but proved unsuccessful.

That amount, which represents almost 2 per cent of Ausdoc's value, exceeds the Takeovers Panel recommended level of 1 per cent.

Kaumeyer and Ausdoc's directors argue that the break fees were appropriate.