Takeover battles ensnare four WA companies

The future ownership of four Western Australian companies hangs in the balance this week following new takeover offers for Consolidated Minerals Ltd, OmegaCorp Ltd, Evans & Tate Ltd and Vietnam Industrial Investments Ltd.

The bidders chasing control of diversified mining house ConsMin, who are led by former BHP Billiton Ltd boss Brian Gilbertson, sweetened their offer after failing to attract any significant support.

The Pallinghurst consortium added an extra 30 cents cash per share, valuing Consmin at $2.82 per share or $625 million (see separate article HERE).

Uranium explorer OmegaCorp was also the subject of an improved offer, this time from Canadian company Denison Mines Corp.

Denison, which already owns 33.1 per cent of OmegaCorp , has lifted its cash offer to $1.30 per share, valuing the target at about $200 million.

Denison originally to acquire OmegaCorp for $1.10 per share, then lifted its offer to $1.15 per share.

UK-based Central African Mining & Exploration Company surprised the market by launching a competing scrip takeover offer valued at $1.44 per share, but then caused even more surprise by withdrawing its offer two weeks after lodging a bidder's statement.

Meanwhile, the battle for debt-laden Margaret River winemaker Evans & Tate has taken a new turn, with its board assessing a fresh offer for its operations by Great Southern wine producer Ferngrove Vineyard Ltd.

Ferngrove's bid, which involves backing its Frankland River-based winery into the listed-E&T business and a $17.7 million underwritten rights issue, follows an in-principle agreement struck last week between E&T and its bank, ANZ, for a balance sheet restructure involving Peter Fogarty's Pendulum Capital.

ANZ agreed to wipe $45 million off E&T's $100 million bank debt in exchange for 429 million E&T shares, of which it would then sell half for an "undisclosed sum" to Pendulum. The bank also agreed to co-underwrite a $16.7 million renounceable1-for-2 rights issue at 5 cents a share.

Pendulum is acting for a group of investors, including Mr Fogarty.

The Pendulum-ANZ deal does not involve a merger with Mr Fogarty's private wine businesses, which include Lakes Folly and Millbrook.

Ferngrove's proposal includes issuing ANZ 409 million shares at 11 cents each to reduce bank debt by $45 million.

It said there would be a managed exit of ANZ after a 24-month escrow period.

Ferngrove said it would raise up to $20 million via a renounceable1-for-3 rights issue, including oversubscriptions of $2.3 million. The shares will also be issued at 5 cents each.

The winery said $10 million would be used to pay down bank debt and the rest would provide working capital.

Ferngrove's interest in E&T was first revealed by WA Business News last week.

Ferngrove chief executive Anthony Wilkes said his company's bid was superior to Pendulum's because it was bringing $30 million in assets to the table and offered all stakeholders a better return on their investment.

Mr Wilkes said the rights issue would be fully underwritten but would not disclose the underwriter.

WA Business News understands there may be more than one player involved in backing the rights issue.

Failed Evans & Tate suitor Yarraman Winery Inc is expected to launch a second bid for the Margaret River winery within seven days.

Another junior WA company in the midst of a complex takeover battle is the Simon Lee-chaired Vietnam Industrial Investments.

The company said today that its independent directors continued to support the US$12.02 million (A$14.3 million) sale of its two main assets to NatSteel Asia Pte Ltd, a subsidiary of India's Tata Steel.

By default, they have rejected a competing offer for the entire company from investment company Prudential and VII's managing director Henry Lam Van Hung.