10/06/2014 - 10:45

Chinese group makes $35m tilt for Kresta

10/06/2014 - 10:45

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Kresta Holdings’ major shareholder, China-based Aplus, has outlined plans to acquire the Malaga-based company just six months after buying a large interest in the group.

Kresta Holdings’ major shareholder, China-based Aplus, has outlined plans to acquire the Malaga-based company just six months after buying a large interest in the group.

Aplus, also known as Ningbo Xianfeng New Material Co, said it would offer 23 cents for every Kresta share it doesn’t own, valuing the blind and window manufacturer and retailer at about $35 million.

The offer represents a premium of about 39 per cent to Kresta’s last closing price.

Argonaut Capital and K&L Gates are advisers to Aplus, which manufactures fabrics in China.

Kresta told its shareholders to take no action until it had fully considered the proposed offer.

The bid comes after Aplus acquired a 14 per cent stake in Kresta in January and follows a turbulent six months for the ASX-listed company.

Following the Aplus buy-in, Kresta chief executive Giuliano Di Bartolomeo, chairman, Peter Abery, and non-executive directors John Molloy and Kevin Eley left the company in a major board shake up.

Subsequently, the founder and chairman of Aplus, Xianfeng Lu, was appointed as managing director of Kresta.

Aplus’s January buy-in also came just weeks after an earlier transaction in which Chinese investor Xiaoyang Lu purchased a 19.9 per cent stake in Kresta.

Aplus said the takeover offer was conditional upon the company acquiring all of the outstanding shares in Kresta, which would include the consent of the company's other major shareholder Fiesta Design.

The Queensland manufacturer bought a 19 per cent stake in the company in 2011 from former Kresta chairman Ian Trahar.

Mr Trahar divested his interests in Kresta after failing to complete a $47 million takeover of the company in the same year.

Back then Mr Trahar was offering Kresta shareholders 32.5 cents per share.

The takeover bid was made after fund manager Hunter Hall Investment Management, which was a Kresta major shareholder at the time, tried to oust Mr Trahar and fellow director Peter Hatfull from the board, citing concerns about disappointing profits and a sliding share price.

Hunter Hall sold its stake in Kresta late last year.

Kresta’s shares were up 24 per cent at 10:30am (WST) to 20.5 cents.

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