11/05/2006 - 12:09

Futuris bids to acquire ITC minorities

11/05/2006 - 12:09

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Futuris Corporation Ltd through subsidiary Hatmore Pty Ltd has announced an unconditional scrip/cash offer to increase its shareholding in its subsidiary, West Perth-based timber processor Integrated Tree Cropping Ltd.

Futuris bids to acquire ITC minorities

Futuris Corporation Ltd through subsidiary Hatmore Pty Ltd has announced an unconditional scrip/cash offer to increase its shareholding in its subsidiary, West Perth-based timber processor Integrated Tree Cropping Ltd.

Futuris, which currently holds a 55 per cent interest in ITC, is offering all ITC shareholders three Futuris shares for every five ITC shares held, or $1.30 cash, payable within 7 days of acceptance.

The share offer is valued at $1.35 per share based on an imputed price of Futuris shares of $2.25. The offer represents a 30 per cent premium over ITC's price of $1.04 immediately prior to this announcement and 25 per cent over the three month volume weighted average price of $1.08 per share to 10 May 2006.

Futuris chief executive Les Wozniczka said: "ITC has made substantial progress in the development of its operations and management. However, market appreciation of value has been affected by uncertainty about regulatory change and about the capital requirements for growth and corporate opportunities."

"We believe ITC shareholders may see value in realising a premium price for their shares now."

"ITC shareholders who wish to maintain their exposure to hardwood timber will be able to achieve that through acceptance of the Futuris scrip offer."

Futuris' share price at 1200 WST was $2.22.

 

Below is the full announcement:

 

Futuris Corporation Limited through its subsidiary Hatmore Pty Ltd ABN 12 096 553 909 ("Futuris"), announces an unconditional scrip/cash offer to increase its shareholding in its subsidiary Integrated Tree Cropping Limited ("ITC" ASX code ITF).

Futuris currently holds a 55% relevant interest in ITC, Australia's largest hardwood plantation manager and the nation's largest hardwood timber processor.

Futuris is offering all ITC shareholders 3 Futuris shares for every 5 ITC shares held, or $1.30 cash, payable within 7 days of acceptance.

Benefits to ITC shareholders include:

Premium price. The share offer is valued at $1.35 per share based on an imputed price for Futuris shares of $2.25. The offer represents a 30% premium over ITC's price of $1.04 immediately prior to this announcement and 25% over the three month volume weighted average price (VWAP) of $1.08 per share to 10 May 2006.

The Futuris share price immediately prior to this announcement was $2.25 and the three month VWAP to 10 May 2006 was $2.26 per share.

The cash alternative offer represents a premium of 25% over ITC's price of $1.04 immediately prior to this announcement and 20% over the three month VWAP of $1.08 per share 10 May 2006.

Attractive terms. The offer is unconditional and payable within 7 days of acceptance.

Improved liquidity. ITC shareholders who choose to accept FCL scrip will achieve ongoing exposure to hardwood in a stock with greater liquidity.

Rollover relief. If as a result of the offer Futuris has a relevant interest of 80% or more, ITC shareholders may qualify for capital gains tax rollover relief on their investment.1

1 Investors should seek their own tax advice to confirm their individual position in respect their tax obligations.

Futuris Chief Executive Les Wozniczka said:

"ITC has made substantial progress in the development of its operations and
management. However, market appreciation of value has been affected by
uncertainty about regulatory change and about the capital requirements for growth and corporate opportunities."

"We believe ITC shareholders may see value in realising a premium price for their shares now. "

"ITC shareholders who wish to maintain their exposure to hardwood timber will be able to achieve that though acceptance of the Futuris scrip offer."

ITC shareholders are encouraged to consider all information contained in the Bidder's Statement once it is available.

Ongoing operations

Futuris recognises that ITC's success and promising outlook is largely attributable to its management and staff.

Futuris does not envisage any changes to the management of the Company.

Should ITC become wholly owned then ITC will continue to operate in its present form as a wholly owned subsidiary within the Futuris group of Companies.

Bidder's Statement

Further information concerning the offer for ITC will be contained in the Bidder's Statement which it is expected will be served on ITC and lodged with the ASX and the Australian Securities and Investments Commission within the next week. It will be dispatched to shareholders soon after. Following lodgement, a copy of the Bidder's Statement will be available on Futuris' website at: www.futuris.com.au.

Shareholder Information

Further information on the offer will be lodged with the ASX and included on Futuris' website.

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