No fat left in waste price

Terry Peabody

SYDNEY - Transpacific Industries chairman Terry Peabody will not increase his $870 million bid for Waste Management and may drop the offer if he fails to win enough acceptances.

"It's our final price and it certainly will not be changed," Peabody said. "It's either on or it's off."

The deal will create the biggest rubbish disposal company in Australasia. The shares of Auckland-based Waste Management have surged 23 per cent since the bid was announced on March 27 and finished on Friday at $8.60, 4c below Transpacific's $8.64 offer.

Waste Management last week hired Grant Samuel to assess Transpacific's offer, which shareholders will vote on next month.

Brisbane-based Transpacific expects the acquisition, already approved by Waste Management's board, to be completed by June. Its stock, which has surged 37 per cent since the bid was announced, is trading around A$8.52 ($10.20).

Peabody said the deal would not affect his plans to bid for Brambles' Australian units, which Merrill Lynch values at about US$1.2 billion ($1.97 billion).

"This is where we're going with or without Waste Management," he said. "It's certainly going to be a competitive process and there is a great deal of interest."

Transpacific is bidding for the Brambles businesses in partnership with buyout firm Castle Harlan Australian Mezzanine Partners.

- BLOOMBERG