Offer brings plastics saga close to resolution

The final twist in the long-running takeover bid for plastic packaging group Vertex may have come yesterday with the Stewart family upping its offer 4c to $2.09 a share and winning the approval of independent directors.

By last night, the family's investment firm, Masthead, had received acceptances from shareholders owning 5 per cent of the company - taking its stake to just over 30 per cent.

The amended offer values the company at $66.9 million

Masthead director Mark Stewart said he was reasonably confident of reaching the 50 per cent target.

The end game is merging Vertex with rival company Alto Plastics.

Vertex independent directors Tony Frankham and Sandy Maier yesterday recommended shareholders accept the amended offer, "in light of the withdrawal of interest of other potential bidders and the significantly reduced prospect that any further bidder will emerge".

Stewart said Vertex's largest shareholder after Masthead, businessman Hemat Lal Patel, had sold the firm its 4.99 per cent stake yesterday.

"I'd say by mid-next week we'd be getting pretty close."

Vertex managing director Paddy Boyle, who has publicly opposed Masthead and its directors - Stewart and Warwick Webb - also said he would accept Masthead's offer which will see him pocket $1.3 million for his 1.9 per cent stake.

"The company has performed well. It's worth more than that but, on the sharemarket today, I think $2.09 is a realistic offer," said Boyle.

 

Masthead has extended the closing date for its offer by another week to May 24.

The present offer price is still 5c below the $2.14 to $2.39-a-share price range of independent valuer Grant Samuel last month.

Stewart called the valuation "blue sky". He said $2.09 a share was a "generous" price for the company which has had a chequered two-year history on the sharemarket.

During that time it has had four chairmen, made two profit warnings and been embroiled in a bitter board dispute sparked when the Stewarts bought their initial 19.9 per cent stake from Gould Holdings - the investment firm of Christchurch businessman George Gould - for $2.05 a share in September.

Stewart would not be drawn on Boyle's future role in the company if the bid succeeded,.

Frankham said Masthead had told him it would seek Boyle's and Maier's resignations if it got control.

Boyle said he had not discussed his future with Masthead.

"I regard my role as chief executive as simply ongoing with no change."

Frankham, appointed interim chairman by the High Court in December to ease the boardroom deadlock, said his role in the company would end if Masthead's takeover went unconditional.

 

Since launching its takeover bid on March 1, the Stewarts' pursuit has been marked by twists, with two mystery bidders emerging and then disappearing.

The first, understood to be Australian packaging giant Visy, pulled out of the running after Easter when it found similarities between the two businesses were not as strong as it thought.

Last week, independent directors said another company was looking over the company, but that party withdrew within hours.

 

Vertex shares closed up 4c yesterday at $2.07.

- additional reporting NZPA