Capilano shareholders to vote on takeover

Capilano shareholders to vote on takeover

Honey producer Capilano (ASX: CZZ) has announced it is being eyed for potential takeover by a consortium of private equity funds.

This morning, the listed company told shareholders of its recommendation to allow the consortium of firms to take over the company.

Capilano has entered into a scheme implementation agreement with Bravo HoldCo, an entity owned by Wattle Hill RHC Fund 1 (Wattle Hill) and ROC Capital Pty Ltd (Roc Partners).

The company has unanimously recommended shareholders accept that agreement.

Under the deal, HoldCo will acquire 100 per cent of the share capital of Capilano, giving shareholders $20.06 per share in cash; a premium of 28.2 per cent to the last close.

Shareholders can also elect to take a scrip alternative with the potential to participate in the future of Capilano through an all-scrip 1:1 offer.

The scheme is conditional on shareholders representing at least 15 per cent electing to receive scrip. If scrip elections and Subscription Offer applications collectively exceed 49.9 per cent of HoldCo shares, scale back arrangements will apply.

According to Capilano, major shareholder Wroxby Pty Ltd - which currently holds 20.6 per cent of Capilano shares - has indicated that it intends to vote in favour of the scheme and to elect to receive scrip consideration rather than cash consideration, ensuring the minimum scrip consideration is met.

The vote to decide the future of the honey manufacturer will be held in November 2018, with the implementation of the takeover to begin in December 2018.

Capilano chairman Trevor Morgan says shareholders would be wise to take this deal now to realise their investment early.

"The Board remains confident that Capilano is well positioned to deliver growth across its brand portfolio in both the domestic and export markets," says Morgan.

"This growth, particularly our investment into our premium and therapeutic brands and marketing into the Asian region, will take time and involve execution risks. Therefore, we believe shareholders should have the opportunity to realise their Capilano shares in cash now."

Capilano managing director Ben McKee says the consortium is primed to take the brand to the next level.

"The Consortium will being added capability necessary to build our brands on a truly global scale," says McKee.

"In particular Wattle Hill's strong relationships in Asian markets provides an opportunity to unlock the potential of Capilano Group's premium and therapeutic brands. The Consortium understand the importance of our Beekeeper network and outlined its intention to invest further into the industry."

The scheme requires approval of 75 per cent of all votes cast by shareholders and a minimum of 50 per cent of all shareholders to vote. The future of Capilano will be decided at a shareholder meeting in November 2018.

Shares in Capilano are up 26.45 per cent to $19.79 per share at 10.35am AEST.

Never miss a news update, subscribe here. Follow us on Facebook, LinkedIn, Instagram and Twitter.

Business News Australia

Get our daily business news

Sign up to our free email news updates.

Please tick to verify that you are not a robot

 
The MBA that helped Epic Environmental’s startup employee become GM and partner
Partner Content
Environmental engineer Romin Nejad began his career at Epic Environmental at a challeng...
Queensland University of Technology
Advertisement

Related Stories

Crionet buys majority stake in LIGR, Australia's Canva for sports broadcasts

Crionet buys majority stake in LIGR, Australia's Canva for sports broadcasts

Italian sports technology group Crionet has acquired a majority sta...

New Zealand’s Entrada Travel Group in the driver’s seat after snaring Greyhound Australia

New Zealand’s Entrada Travel Group in the driver’s seat after snaring Greyhound Australia

New Zealand-based tourism and transport company Entrada Travel Grou...

Rinehart joins the billionaire rush for iconic Aussie fashion with Driza-Bone acquisition

Rinehart joins the billionaire rush for iconic Aussie fashion with Driza-Bone acquisition

Billionaire mining magnate Gina Rinehart has followed in the steps ...

Bidding war kicks off for comms-tech Whispir as Pendula swings in

Bidding war kicks off for comms-tech Whispir as Pendula swings in

Sydney-headquartered customer engagement platform Pendula has weigh...