18-Apr-2006 10:32 AM
Australia's Patrick accepts revised Toll takeover offer
Analysis
SYDNEY (XFNews) - Australian ports operator Patrick Corp has accepted a sweetened takeover offer from logistics giant Toll Holdings after rejecting the company's overtures for more than eight months.
In a deal worth 5.81 bln aud, Patrick said it had accepted an increased offer of 0.4 Toll shares plus three aud in cash for each Patrick share.
The takeover will create a company worth 10.2 bln aud, the world's fourth-largest transport and logistics firm behind United Parcel Services, Fedex Corp and TNT.
It will markedly expand Toll's interests in Australia's major container ports and give it 100 pct ownership of the Pacific National rail freight joint venture it now co-owns with Patrick.
Toll chief executive Paul Little said the takeover would create a unique transport and logistics group serving the Asian region.
The deal will also result in discount airline Virgin Blue, currently majority owned by Patrick, coming back under the control of its founder, British billionaire Richard Branson.
Under the deal, Toll will cut Patrick's share in Virgin Blue from 62.4 pct to as low as 10 pct, opening the way for Branson's company to regain its position as the major shareholder in the Australian carrier.
Branson said Little showed courage and vision in pursuing Patrick.
"We look forward to a speedy conclusion to the takeover and working with Paul Little and the Toll group to map out the future direction of Virgin Blue," he said in a statement, according to Agence France-Presse.
Patrick and Toll said that the boards of both companies were unanimously behind the deal.
Patrick managing director Chris Corrigan, a harsh critic of the previous Toll proposals, said the increased offer represented a fair price for Patrick shareholders.
"I believe that Toll's new offer reflects the full value of the business," Corrigan said.
"I'm pleased that we have been able to achieve this result for Patrick shareholders who may now choose to share in the benefits of the merged Toll and Patrick businesses."
Patrick said it would not seek any higher bids from other companies and confirmed both companies had agreed to end legal proceedings against each other over the offer.
Toll launched a hostile takeover bid in August last year and was rebuffed, renewing the assault with a raised offer last month which values Patrick at 8.26 aud a share.
The Australian Stock Exchange was closed for the Easter break Friday. Patrick last traded Thursday at 8.03 aud and Toll at 3.15.
The takeover will create a company worth 10.2 bln aud, the world's fourth-largest transport and logistics firm behind United Parcel Services, Fedex Corp and TNT.
It will markedly expand Toll's interests in Australia's major container ports and give it 100 pct ownership of the Pacific National rail freight joint venture it now co-owns with Patrick.
Toll chief executive Paul Little said the takeover would create a unique transport and logistics group serving the Asian region.
The deal will also result in discount airline Virgin Blue, currently majority owned by Patrick, coming back under the control of its founder, British billionaire Richard Branson.
Under the deal, Toll will cut Patrick's share in Virgin Blue from 62.4 pct to as low as 10 pct, opening the way for Branson's company to regain its position as the major shareholder in the Australian carrier.
Branson said Little showed courage and vision in pursuing Patrick.
"We look forward to a speedy conclusion to the takeover and working with Paul Little and the Toll group to map out the future direction of Virgin Blue," he said in a statement, according to Agence France-Presse.
Patrick and Toll said that the boards of both companies were unanimously behind the deal.
Patrick managing director Chris Corrigan, a harsh critic of the previous Toll proposals, said the increased offer represented a fair price for Patrick shareholders.
"I believe that Toll's new offer reflects the full value of the business," Corrigan said.
"I'm pleased that we have been able to achieve this result for Patrick shareholders who may now choose to share in the benefits of the merged Toll and Patrick businesses."
Patrick said it would not seek any higher bids from other companies and confirmed both companies had agreed to end legal proceedings against each other over the offer.
Toll launched a hostile takeover bid in August last year and was rebuffed, renewing the assault with a raised offer last month which values Patrick at 8.26 aud a share.
The Australian Stock Exchange was closed for the Easter break Friday. Patrick last traded Thursday at 8.03 aud and Toll at 3.15.