KEY POINTS:
The deadline for MFS Living and Leisure's takeover bid for Tourism Holdings expired at midnight last night, but it will be Tuesday at the earliest before the market knows if the Queensland company has been successful.
Indications are that the outcome of the bid, which is conditional on 90 per cent acceptance, is going to go right down to the wire. By Friday, MFS had obtained about 75 per cent of Tourism Holdings at its $2.80 a share offer price.
"I believe that they are sitting on about 75 per cent and there is obviously a bit of work going on with the remaining smaller institutions," Tourism Holdings chief executive Trevor Hall said.
"It takes about three or four days for the pre-paid documents to come in so I would say, that by Tuesday at the earliest, they would know."
Tower, which is understood to have a stake of about 2.8 per cent, has so far held out, along with a host of little funds, each with about 0.5 to 1 per cent.
About 20 million shares are held by small retail investors.
"They haven't got far to go but it is obviously very, very close," Hall said.
Forsyth Barr's head of research, Rob Mercer, agreed the battle for Tourism Holdings would be tight. He estimated that about 9 per cent of the stock was held by three or four entities.
AXA Rosenberg IM, as distinct from AXA Alliance which had already accepted the offer, had retained its 3.8 per cent holding, Mercer said.
He estimated that about 12 per cent of the company is with people holding fewer than 25,000 shares. Mercer said it would be hard for MFS to mobilise the smaller shareholders because they were not an active group.
"My feeling is that here is a good chance that MFS will push into the mid-80s and that it's probably a harder stretch for them to get to the 90 per cent level."
If the desired level was not reached, MFS might just have to walk away as Mercer doubted the company had the capability to carry on as a partial owner of Tourism Holdings. "The reality is that they do have choices to make and it's going to go down to the wire," he said.
Forsyth Barr resisted recommending the offer but had a change of heart when it became evident that there was no alternative plan.
"We needed to see some leadership from the major shareholders to say that this is what we want the board and the management to do, but that didn't happen," Mercer said.
Furthermore, there was no other party coming forward to challenge the $2.80 bid.
