Ann: GENERAL: MTF: Update - Turners unsolicited ordinary share...

• Release Date: 21/09/15 08:30
• Summary: GENERAL: MTF: Update - Turners unsolicited ordinary share offer
• Price Sensitive: No
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					MTF
21/09/2015 08:30
GENERAL
PRICE SENSITIVE
REL: 0830 HRS Motor Trade Finances Limited

GENERAL: MTF: Update - Turners unsolicited ordinary share offer

Turners Finance Limited - Unsolicited ordinary share offer

Further to our release of 14 September 2015, Motor Trade Finances Limited
(MTF) advises that Turners Limited (NZX:TNR), through its subsidiary Turners
Finance Limited (Turners), has now written to MTF ordinary shareholders with
an unsolicited offer to buy ordinary shares at $1.15 per share.  Turners is
prepared to receive acceptances that would take their shareholding up to 20%.
 The offer closes on 17 October 2015.

Separately, MTF has received an approach (see below) from Heartland New
Zealand Limited (Heartland) that may be relevant to ordinary shareholders'
consideration of the offer from Turners.

Your Board intends to engage with both of these parties and also to take
advice on the issues raised by Turners' offer and Heartland's approach.  At
this point, we believe it would be prudent for ordinary shareholders to await
further advice from the Board before making any decision in relation to their
shares.

MTF cautions ordinary shareholders about relying on recent traded values as a
guide to underlying value.

An internal valuation was completed last year (with the assistance of an
external expert) which valued our ordinary shares, for dry (non-originating)
shareholders, at $1.16 per share.  The valuation was substantially higher for
active shareholders, as in addition to the base value per share shareholder
originators enjoy value from their total shareholding in the form of extra
commission as a consequence of their relationship with and control over MTF.
In considering the merits of Turners' offer and offer price, these
shareholders should have regard to this additional value and the possibility
of its loss or diminution should there be changes to MTF's commission
arrangements following the Turners' offer.  This is an important factor that
the Board will be considering. Although a number of factors have changed
since the valuation, the Board does not believe the current value is likely
to be materially lower than last year's valuation and does believe it could
well be higher.

The Board is in the process of seeking an update to the original valuation
from the external expert and expects to be in a position to share the outcome
with ordinary shareholders prior to the closing date for the Turners' offer.

At this stage, the Board expects to declare a further dividend of 7 cents per
ordinary share, with that dividend most likely to be paid in November 2015.
This would mean a total dividend for the 2015 financial year of 13 cents per
ordinary share.  Subject to business performance and capital requirements,
the Board's current expectation is that the company will maintain the current
dividend level in the near term.

Acceptance of Turners' offer will not guarantee that you will be able to sell
all the shares you agree to sell.  When the offer closes, if total
acceptances are greater than the amount that Turners wishes to acquire, or is
allowed to acquire, acceptances will be scaled pro-rata.  Early acceptance of
the offer does not provide any benefit or priority to a shareholder.

As we mentioned in our earlier letter, Turners cannot acquire more than 10%
of our ordinary shares without both board approval and shareholder approval.

The Board, which must act in the best interest of the company, continues to
consider whether there are any circumstances in which Turners holding more
than 10% would be beneficial to the company and its shareholders.  A major
consideration in this assessment is that a stake of up to 20% would
materially limit the ability of any other party to make an offer for MTF.
This may have value consequences for all MTF stakeholders.  The Board is
seeking further engagement with Turners and also taking advice on the matter.
 At this point, we believe it is advisable for shareholders to await further
advice from the Board before making a decision to accept the Turners' offer.

Communication from Heartland

In response to Turners' letter to MTF shareholders, the Board received a
letter on 18 September 2015 from Heartland, reaffirming its interest in MTF.
 You will recall that in 2014 Heartland approached MTF with a takeover
proposal that did not proceed. While there is no certainty at this point
that Heartland will make an offer or that any offer, if made, would be
recommended by your Board, its recent approach does indicate that
shareholders would be advised to give themselves time to assess all available
options and await further advice from the Board.

As indicated above, the Board intends to engage with Heartland, as well as
taking advice on the matter.

We will provide an update to ordinary shareholders, taking account of the
issues raised by the Turners' offer and the Heartland approach, before the
Turners' offer period closes.

Yours sincerely

Stephen Higgs
Chairman
Motor Trade Finances Limited
03 474 9716
End CA:00270421 For:MTF    Type:GENERAL    Time:2015-09-21 08:30:12