PRG finally pulls in Bendon

By ELLEN READ markets writer

Pacific Retail Group (PRG) has won control of Bendon and will now take full ownership of the lingerie manufacturer.

PRG yesterday reached 90.03 per cent ownership of Bendon, a level which allows it to compulsorily acquire all remaining shares under the Takeovers Code.

Bendon, which will operate as a separate business unit under PRG, will be delisted from the Stock Exchange.

Before it reached the 90 per cent mark, PRG extended its takeover offer until April 9 as it eyed sole ownership. This extension stands, although it is largely unnecessary as remaining shareholders must sell their stakes to PRG.

PRG - majority owned by Eric Watson's Cullen Investments - moved easily past the 50 per cent stake required for the takeover as fund manager AMP Henderson Global sold its 26 per cent stake yesterday.

"Following the unsuccessful bid by Intimate Brands, we considered the different options available and the high acceptance of the PRG offer," AMP Henderson managing director Catherine Savage said.

"As a result, we have decided the best way to realise value in Bendon for our investors is to sell our full holding of 26 per cent into the offer."

AMP Henderson was part of the rival Intimate Brands consortium, led by Bendon managing director Hugo Venter, which had proposed buying Bendon's operating subsidiary.

That bid failed when Bendon's independent directors said they favoured PRG's lower offer of $1.90 a share for the whole company.

The directors said the PRG offer was unfair in terms of price but recommended shareholders accept it due to its simpler form and greater certainty.

Venter was not talking about his future yesterday, except to say he had talked to PRG and was going away to enjoy Easter with his family.

"I've spent a lot of time and energy on this and I'd really just like to sit down and have a bit of a think about what I want to do," he said.

Cullen Investments group managing director Phil Newland said the company had constructive discussions with Venter and saw no need for a change in his position.

PRG chief executive Peter Halkett said options for Bendon included new product categories, new markets and new sites but that no decisions had been made yet.

This month Bendon directors rejected suggestions that Farmers would abandon Bendon products if PRG won control of the company.

PRG and Farmers are rivals in the appliance market and there was talk that Farmers would not look kindly on the products of a competitor when stocking its shelves.

However, Bendon chairman Ian Parton said Farmers chief executive Nick Lowe had told him Farmers expected to continue to buy Bendon products, "although the purchases might not follow traditional buying patterns".

An expanded network of Bendon retail outlets was also speculated on in relation to a successful PRG takeover.

Analysts said this would make sense as this would increase margins and raise the profile.

Bendon has 19 retail premises - nine Bennett & Bain shops, two Bendon shops and eight factory outlet stores.