Oyster Bay valuations varied by $45m

Valuations of Oyster Bay Marlborough Vineyards varied by up to $45 million, papers released yesterday by the Takeovers Panel showed. The Takeovers Panel yesterday released the reasoning behind its ruling that Oyster Bay breached the Takeovers Code.

The panel said information about the market value of Oyster Bay, on both an encumbered and unencumbered basis, should have been made available to shareholders in the target company statement.

Oyster Bay has a number of long-term contracts in place, which basically set out Delegat's rights to manage Oyster Bay's vineyards and buy its grapes. The difference between the encumbered and unencumbered valuations reflects the difference between the company operating with and without the long-term contracts.
Peter Yealands Investments and David Rankin assessed the market value of Oyster Bay's vineyard assets at $90 million on an unencumbered basis. Advisers Ferrier Hodgson valued the assets at $45 million on an encumbered basis.

The $90 million valuation implied a net tangible asset amount of Oyster Bay of $8 a share, double the $4 a share offer from Delegat's.

The panel said the nature of Oyster Bay's contracts with Delgat's suggested it would be extremely unlikely Oyster Bay could sell its assets on an unencumbered basis.

The panel has not annulled Delegat's bid, but has given Oyster Bay's shareholders the option of revoking their acceptance of its offer once they have received the new information.

- NZPA