Why would you short Tassals *now*?, page-891

Bridget Carter writes in the Monday 23 August 2021 'The Australian':

"A fierce battle is expected to emerge for Huon Aquaculture should the Foreign Investment Review Board knock back an agreed deal by Brazilian meat processing firm JBS to buy the Tasmanian salmon producer.

However, parties are not expected to offer anything like the $3.85 per share that JBS has agreed to pay for Huon, a price that takes its market value to $425m.

DataRoom can reveal that the under bidder in a Grant Samuel-run auction to buy Huon, Canadian-based global seafood giant Cooke Aquaculture, is understood to have offered $3 per share or $330m by market value.

This column also understands Brookfield was one of the underbidders, rather than TPG Capital as some had earlier suggested.

This indicates it was far outpaced by JBS, which reached an agreement with both Huon and its majority shareholders and founders Peter and Frances Bender, as announced on August 6.

The Benders own 53 per cent of the company.

Larger listed competitor Tassal Group weighed a move early on and offered $2.20 to $2.40 per share, but dropped out once the pricing became more competitive.

However, Tassal is likely to take a second look if another auction takes place.

Turnaround funds were also initially interested but walked away early on once learning industry groups were getting serious.

According to Goldman Sachs analysts, the JBS offer equates to 8.9 times Huon’s forecasted earnings before interest, tax, depreciation and amortisation for the 2022 financial year, while larger rival Tassal is trading on 6.1 times its EBITDA forecast for the 2022 financial year."