http://www.abc.net.au/worldtoday/content/2006/s1631519.htmMacquar...

http://www.abc.net.au/worldtoday/content/2006/s1631519.htm

Macquarie Bank to bid for Patrick Corporation

The World Today - Friday, 5 May , 2006 12:45:00
Reporter: Peter Ryan
ELEANOR HALL: There's been a surprise twist in one of the year's most dramatic takeover battles, the Toll bid for Patrick Corporation.

Today Macquarie Bank has confirmed that it will make a counter offer for the stevedoring company.

The rival bid comes only weeks after the Patrick's board agreed to a $4.6-billion offer from its chief competitor Toll Holdings.

We're joined now by Business Editor Peter Ryan, who's been following this morning's developments.

So, Peter, has this move by Macquarie Bank come as a surprise?

PETER RYAN: Yes, indeed, Eleanor. A surprise this morning. First in the Australian Financial Review newspaper there was speculation about this bid.

And then Macquarie Bank chose to officially call a trading halt in which Macquarie Bank, Toll Holdings and Patrick shares were suspended while an announcement went out, and that did surprise the market.

And also, it comes only a few weeks after Patrick shareholders were told by their board that it would be good to accept the offer, and so …

ELEANOR HALL: The offer from Toll, you mean?

PETER RYAN: That's right, yes.

So it's come as a surprise. It was seen as being a done deal.

And now Macquarie Bank have come in with an offer and they're expected to offer a premium for Patrick. So if you're a Patrick shareholder you'd be very happy this morning.

ELEANOR HALL: So what's behind this move from Macquarie Bank? What's in it for Macquarie?

PETER RYAN: Well, of course it's all about money and it's all about controlling the ports and rail around Australia.

And Patrick believes that it is able to set up a consortium to make a cash bid for Patrick, but made the point in this morning's statement to the stock exchange that it's still waiting to get a final commitment from all parties.

And some of those parties that they're talking to, we understand, are from Singapore, Hong Kong and the United Arab Emirates.

So, Eleanor, it's all about money and it's all about controlling the ports and railways around Australia.

ELEANOR HALL: How is Patrick's board likely to view the Macquarie bid?

PETER RYAN: Well, I think that the Patrick board would be very pleased at this point, having already received a premium offer from Toll Holdings.

And they'd be very happy looking at where their share price has gone this morning. Patrick shares have gone up three and a half per cent to $9, and that's well above the Toll offer.

Macquarie Bank shares have also lifted one and a half per cent. It's not known as a millionaire's factory for nothing. Macquarie's shares are up to $70.35.

But the news isn't good at all for Toll Holdings, which thought it had a done deal. Its shares fell almost 4 per cent this morning to $13.27, and the reason for that is that Toll shareholders now face the prospect of having to pay a lot more if they want Patrick.

ELEANOR HALL: So how does Macquarie plan to conduct the takeover? I mean it was quite a difficult effort for Toll, wasn't it?

PETER RYAN: Yes, eight months worth of blood, sweat and tears to actually get to the point that they want.

But Macquarie, once they get their consortium together, that would be a cash offer, and we'd be seeing another hostile battle on the sharemarket to control ownership in the company.

And by the way, the timing of this is not good for Toll. They have until next Friday to get at least half of the company. And if you were a Patrick shareholder, you'd be waiting to see if you could get more money for your shares.

ELEANOR HALL: Peter Ryan, our Business Editor, thank you.