Montana directors 'lost out' in sales to Allied

By DITA DE BONI liquor writer

Montana's independent directors came clean about selling some of their holdings yesterday, revealing that they have effectively lost money by selling shares to preferred bidder Allied Domecq.

While confirming reports that they had relinquished some holdings, the directors continued to maintain that their responsibilities were to ensure the best outcome for all Montana shareholders.

"The current market price provides an opportunity for all shareholders to sell their holdings at a price at the upper end, and above, of the range recommended by the latest PricewaterhouseCoopers appraisal report," they said.

In fact, Montana's directors had recommended that shareholders accept Allied Domecq's $4.40 bid in mid-February, reasoning that Allied had made the offer to all shareholders, whereas Lion's $4.65 offer disadvantaged many by only partial buying of stock.

As stated in yesterday's notice, chairman Brian Mogridge sold almost half his holding in Montana in March.

He made $2 million out of selling his 490,000 shares for $4.10, the market value of those shares on the day.

Deputy chairman Barry Neville-White sold 409,624 shares, or two-fifths of his holding, last Friday for $4.55, and Dr Hylton LeGrice sold 221,018 shares for the same price.

Dr LeGrice was not a director when the company's last annual report was prepared and so his exact holding before the sale is unknown.

Shareholders have also lost money by selling to Lion Nathan in the stampede to get $4.65 for their shares in February.

While the waiver obtained by Lion from the Stock Exchange and its subsequent lightning-quick purchase of shares caused an uproar at the time, shareholders would have made a premium of around 25 per cent as of yesterday if they had held on to them.

And the price of shares continues to climb.

The stock hit a high $5.05 before settling back to close at $4.90, up 9c from Wednesday.

Meanwhile, during the day, Lion Nathan had filled its stand for just over 8 million more shares in the company, taking its holding to 61.5 per cent.

Allied continues to hold around 10 per cent and will stand in the market on Monday with a matching bid to Lion of between $4.65 and $5.05 a share.