looks like we are looking at a intial offer of $11 maybe...

looks like we are looking at a intial offer of $11 maybe $12.50



Kirin moves on Lion NathanMiriam Steffens and Jamie Freed
April 23, 2009 - 12:01PM
Lion Nathan's shares are in a trading halt this morning after it received a takeover offer likely to value the company at more than $5.5 billion from its major shareholder, Kirin Holdings, late yesterday to take out the minority shareholders.

The Japanese beverages maker, which owns 46.13% of Lion Nathan's shares, had made an "indicative, non-binding, conditional and confidential proposal to acquire all of the outstanding shares in the company'' it doesn't yet own, Lion Nathan said in a statement to the stock exchange.

BusinessDay understands the value could be around $11 a share, which would represent about a 30% premium to Lion Nathan's last closing price of $8.31 before the bid was announced. Kirin would fund the acquisition with debt facilities. Citi has estimated Kirin has a $5.7 billion war chest available for acquisitions, and said it could pay up to $12.50 a share for Lion.

Kirin is seeking to grow its business in the Asia-Pacific region. In recent years, it has bought National Foods and Dairy Farmers in Australia. It is believed to be keen to keep Lion Nathan's chief executive, Rob Murray, and his management team in place, possibly giving them control of Kirin's entire regional business.

Lion Nathan said it would form an independent board committee to assess the proposal. The trading halt would last for the rest of the week, or until the company makes an announcement in regards to the offer.

BusinessDay understands Kirin is conducting due diligence on Lion Nathan while it remains in the trading halt.

Kirin has appointed JP Morgan and Deutsche Bank to advise it on the deal.

The move comes two months after Lion Nathan was forced to abandon a plan to combine its beer business with Coca-Cola Amatil to create an $11 billion beverages giant. The talks with Coca-Cola had collapsed after Kirin and Coca-Cola Amatil's controlling shareholder, The Coca-Cola Co, failed to agree on the terms.

After the failed merger, analysts suggested that taking control of Lion Nathan would the most sensible expansion path for Kirin in Australia. But Mr Murray, had recently played down speculation that Kirin would seek full control.

"There's been that speculation for 10 years and the truth is Kirin have never bought or sold a share in Lion in that period,'' he told a reporter in late February. "I think they're comfortable with where they're at [and] I don't see any immediate changes.''

Shares in Foster's, Lion Nathan's rival, were up 33 cents, or 6.8%, to $5.18 in recent trade.

SMH