By Andrew Starke

An independent expert has concluded that Japanese food and beverage firm Kirin Holding’s $3.5 billion takeover bid for Lion Nathan is fair and recommended shareholders approve the deal.

Assessor Lonergan Edwards valued Lion Nathan shares at between $10.95 and $12.21.

Lion Nathan signed an agreement in May to implement a scheme of arrangement enabling Kirin to acquire the remaining 54 percent of Lion Nathan shares that it does not already own for $12 cash per share, which includes a 50c special dividend.

For the deal to succeed, it requires at least 75 percent support from non-Kirin shareholders of Lion Nathan at a scheme meeting to take place on September 17.

Lion Nathan yesterday (Aug 6) released a scheme booklet for the deal, in which it gave the first indication of Kirin’s plan for the brewer after the takeover. 

Kirin intends to merge the brewer with its Australian diary processing business, National Foods, to create an entity called Lion Nathan National Foods.

Lion Nathan’s incumbent CEO, Robert Murray, will stay on at the beer and wine group after assurances that Kirin has no intention to make any major changes to Lion Nathan’s business.

However, final decisions on employment and assets will be subject to a full review of Kirin’s Australasian operations, should the merger be approved.

“Kirin’s proposal is compelling and at a significant premium to Lion Nathan’s historical trading prices,” said Lion Nathan chairman Geoff Ricketts. “The independent expert has confirmed that the offer is fair and reasonable and the independent directors unanimously recommend that Lion Nathan’s shareholders vote in favour of the scheme, in the absence of a superior proposal.”

Lion Nathan shares were trading at $11.78 at midday today (Aug 7), up from $11.71 seven days ago.

The Shout Team

The leading online news service for Australia's beer, wine, spirits and hospitality industries.

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