Hostile fishing takeover bid withdrawn

By Libby Middlebrook

Fishing company Neos Seafoods has withdrawn its takeover bid for Fishery Products International, a Canadian company 8 per cent owned by New Zealand's largest seafood processor, Sanford.

Newfoundland-based FPI has been the subject of a $C142 million ($189 million) hostile takeover by Neos since November.

But yesterday the company withdrew its offer after FPI executives and the Newfoundland Government would not lift a 15 per cent maximum limit on FPI shareholdings by December 30, the date Neos' offer was due to expire.

"I think they've had to withdraw their bid because of the conditions, but they might re-emerge," said Sanford managing director Eric Barratt. "It wouldn't surprise me."

Neos' offer depended on FPI shareholder approval and the removal of the 15 per cent restriction, which is to protect local shareholders.

FPI directors said they were opposed to the takeover because Neos' $C9-a-share offer did not reflect the true value of the company.

However, it is understood that Neos was prepared to increase its offer.

Sanford has invested more than $10 million in 8.11 per cent of FPI shares over the past month. Mr Barratt said the Neos retreat had not changed Sanford's objective to buy 10 per cent of FPI, which was set up in 1987 and is listed on the Toronto Stock Exchange.

He said FPI complemented Sanford's existing operation but he refused to give further details on the company's strategy.