why is it dropping?, page-4

by Ralph Wragg ... RWE Publisher

Sydney - Friday - December 13: When Graeme Hart first appeared
on the Australian business scene in the late 1990s to take up a major
stake in Burns Philp at least one financial commentator called him
stupid.
It all revolved around disaster which struck soon after Hart had
bought his shareholding.
But in the intervening years, Hart, described as a New Zealand
property billionaire, has persevered and currently controls Burns Philp,
helping to lift the shares from a mere 6c to 48c today.
Hart by the way paid up to $2.58 for his original stake.
He never admitted he might have been set up by some sharp
operators at that time.
Burns Philp still has some heavy debt to be written off from its
initial crash but the group is now earning good profits on the back of
spice and base food products traded around the globe.
Hart has now set his sights on Goodman Fielder, the food maker
with famous brands such as Uncle Toby's, Meadown Lea, Buttercup and
White Wings.
The group has been an indifferent performer for years and has
always been about to turn the corner as chief executives came and went.
The shares recently slumped to around $1.37 and Hart appears to
have seen the opportunity to make a takeover bid at $1.85 a share after
an initial raid yesterday which snapped up a 15 per cent stake from
insititutions.
The raid was conducted by Credit Suisse First Boston which is
reportedly willing to carry much of the finance for a total bid worth
$2.2 billion.
Early speculation had ConAgra Foods as the front runner.
Goodman Fielder shareholders will be sorely tempted by the Burns
Philp offer but it could trigger other bids as well from companies like
Nestle, Kraft, General Mills and Sara Lee.
Analysts are already pointing to a David & Goliath encounter
where Burns Philp was valued in the market at $434 million at 54c
yesterday while Goodman Fielder is worth five times as much.
It's now up to Graeme Hart to convince Goodman Fielder
shareholders they have a better future with the Burns Philp group.
On performance he has a good argument.
Shares of Goodman Fielder today rose 37c to $1.86 while Burns
Philp was down 6c to 48c.
ENDS