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Going, going, gone – Haier gets 90% of F&P

UPDATE / 3.15pm: Haier has reached more than 90% ownership of Fisher & Paykel Appliances, enabling it to de-list the company.

In a stock market update this afternoon, Haier says it has control of 92.79% of the company after its $1.28-per-share takeover offer.

Haier New Zealand Investment Holding Company chairman Liang Haishan says in a statement: “We look forward to working with Fisher & Paykel Appliances during the next phase of the development, and identifying opportunities for further collaboration between Fisher & Paykel Appliances and Haier and strengthening both brands and businesses. ”


10.30am: Chinese whiteware giant Haier is expected to go close to 90% of Fisher & Paykel Appliances today – the last official day of its shareholder offer.

This morning, Haier disclosed it had reached 81.21% of the company at its recently-raised offer of $1.28 a share.

With Overseas Investment Office approval, the offer has gone unconditional.

Haier, which bought 20% of F&P in 2009, said last week its offer price was final.

The company might extend its offer today if it gets close to the 90% mark – at which point it can compulsorily acquire the remaining shares and delist the company.

Tower Investments chief executive Sam Stubbs was outspoken about Haier's initial offer of $1.20, calling it a "steal", but his company has reluctantly accepted the $1.28 offer.

He told NBR ONLINE he thinks Haier will get close to 90% of the company today.

"All of the brokers have recommended it and all of the major institutions, I think, now have accepted it.

"So you're probably now relying on people who haven't paid a lot of attention to it; haven't opened the mail. Or obviously are active against doing it.

"My gut feeling is it will be very close." 

F&P directors and senior managers, including former director Gary Paykel, have accepted Haier's offer.

Mr Stubbs says the "base case" is Haier will extend its offer – which it can do before 5pm today – but he did not know whether it would.

According to the Takeovers Code Approval Order 2000, Haier's takeover offer can be extended by up to 60 days, beginning on the day the offer became unconditional.

John Walsh, the Wellington general manager of Haier's spin doctors, Acumen Republic, said last night he could not comment on the possibility Haier will extend the offer.

F&P shares (NZX: FPA) closed up 0.8% last night, to $1.275, on trade of more than eight million shares. The stock started the year at 36 cents.

dwilliams@nbr.co.nz

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Comments and questions
8

A further step in the transformation of NZ into an insignificant 'branch office' economy. With no R & D, there will be no need for designers, researchers, developers - not much brain power needed at all really.

So the company is sold at the very bottom of the valuation range from the adviser's report.

Not exactly a glowing testament to the negotiating skills of the board but sadly par for the course when NZ directors meet sophisticated overseas buyers they weren't at school with or are not related to.

The board hardly had a strong position to negotiate from when the share price was 60c prior to the offer!!

It's also quite amazing that in almost every NZ takeover offer, the 'independent' report suggests a share price range from just above the offer price to a bit more above the offer price. I wonder what the independent valuation would have been two weeks prior to the offer?

See ya, F&P.
Hi ya, Haier.

We've seen the detonation, the rising mushroom cloud; now, waiting for the inevitable fallout from the job losses.

Incompetent management over many years, just like with Fletcher Challenge.

Was inevitable the company was going to disappear sooner or later.

At least it is going to NZ's fastest and soon to be, biggest trade partner.

Look at what the Americans did with Telecom and Australians did with TranzRail.

hopefully they retain R&D in NZ. NO reason to keep HO and back office in NZ. Can all be done cheaper from China and would provide better synergies.

Be interesting to see what happens to the Finance business.

The result of 'socialisation of the countries economy. A shame we don't have economic literate media; who would recognise the danger of socialisim to an economy, instead of continually promoting it, and applauding its ppromotors.