Tower is turning its back on its $118 million hostile takeover bid for Fidelity Life, having not received the financial information it was seeking.The $82-a-share offer of cash and stock was based on a 90% level of acceptances and receipt of certain finan
Tower is turning its back on its $118 million hostile takeover bid for Fidelity Life, having not received the financial information it was seeking.
The $82-a-share offer of cash and stock was based on a 90% level of acceptances and receipt of certain financial information being provided to Tower.
Tower chairman Tony Gibbs last night said that information had not been provided and the offer lapse when it expired on Sunday.
“Further, since the takeover notice was given, Fidelity has published its audited accounts for the year ended 30 June 2010. There are matters raised in those accounts that need to be thoroughly analysed, and their implications evaluated, before TOWER decides any future course of action,” he said.
Fidelity Life had previously indicated it was not comfortable providing the information to its larger rival and called the bid “unhelpful”.
Tower’s offer to pay $82 per Fidelity share, made up of $55 in cash and $27 in Tower shares – represented a small premium to the price Fidelity last fetched before the offer.
Although it was much smaller than Tower, Fidelity Life was larger in the life insurance division, which Tower was looking to grow.
Founded in 1973 by Gordon and Shirley Watson, Fidelity Life provides life insurance, business insurance and savings and investment products in New Zealand, as well as Kiwisaver products.
Tower. 35% owned by Guiness Peat Group, has been on the lookout for a suitable acquisition for some months and Mr Gibbs said the two companies fitted together “hand and glove.”
Shares in Tower fell just over 1% to $1.86 in trading last night.
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