Delegat's $6 offer goes down well

After an eight-month fight for control of Oyster Bay Marlborough Vineyards and more than $1 million in legal costs, Delegat's Wine Estate and Peter Yealands have finally found common ground.

Delegat's said yesterday that it was prepared to pay $6 a share for the listed vineyards, a $1 a share increase from the bid announced on Monday. The new offer, which values Oyster Bay at $54 million, will give Delegat's majority control.

Yealands - who had also been trying to take over Oyster Bay - has agreed to accept the new offer.

"It's a very, very good price. It's a price that no one would have dreamed of six months ago," he said yesterday.

The new price is a significant premium to Delegat's successful $4 a share offer, which was cancelled by the High Court last month due to critical errors in the Oyster Bay target company statement. The previous offer pegged Oyster Bay's value at $36 million.

Yealands, a Marlborough businessman, said he had been preparing to table an offer for more than $5. But he reconsidered his decision after last Friday's Oyster Bay annual meeting when most shareholders threw their support behind Jim Delegat and also re-elected the vineyard's chairman, Bill Falconer, and directors Ross Keenan and Robert Wilton to the board.

"I had decided earlier that one should not be pig-headed and see if there is a commercial solution. The AGM showed how the majority of shareholders saw it and one has to take heed of that," said Yealands. "I have to acknowledge that it was always bloody near mission impossible" to gain control.

He will seek High Court approval early next week to be released from his previous agreement to make a new offer himself. A separate lawsuit against Oyster Bay and Delegat's, which he launched in October, is pending.

Yealands, Oyster Bay's second biggest shareholder with nearly 7 per cent of shares, said after scaling he and other minority shareholders would retain residual shares and be able to recover their initial investment in the company.

Delegat's has roughly 33 per cent of shares, and the new offer will give it a 50.1 per cent stake of Oyster Bay.

Jim Delegat, Delegat's managing director, declined to comment yesterday.


The latest
* Yesterday, Delegat's agreed to pay $6 a share for Oyster Bay Marlborough Vineyards, valuing the company at $54 million.
* Oyster Bay's target-company statement valued it at $45 million.
* Delegat's successful $4-a-share bid was cancelled by the High Court in November. That bid valued Oyster Bay at $36 million.