Rubicon, Fletcher Forest and GPG shares rise after partial bid

12.30pm

Shares in Guinness Peat Group (GPG), Fletcher Forests and Rubicon all rose today after Sir Ron Brierley's investment firm GPG yesterday launched a $67 million partial bid for Rubicon at 75 cents per share.

GPG said the bid for control of Rubicon, which owns 18 per cent of Forests, was aimed at setting a new direction for New Zealand forestry.

Rubicon shares today rose 5 cents to 74 cents, while Forests rose 1 cent, 4 per cent, to 24 cents, and GPG rose 3 cents to 178.

Brokers have assessed the bid as undervaluing Rubicon.

Forsyth Barr Frater Williams executive director Don Turkington said Rubicon's rise to nearly the offer price could be read different ways.

"It probably means that whoever is buying at 74 cents, and it looks like it's institutional buying, expects GPG will be successful and will do something with Rubicon which adds value; or alternatively they think GPG will have to pay some more," he said.

Rubicon's directors said an independent directors committee had been set up and would appoint advisers to assess the bid.

That report, along with a directors' recommendation, would be sent to shareholders no later than 14 days after GPG's offer was sent to Rubicon shareholders.

Under the New Zealand Takeovers Code, Guinness Peat Group must send its offer to Rubicon shareholders between September 11 and September 27, and hold the offer open for 30 days.

- NZPA