So what will happen now, will the ANZ’s sweetened offer of online share trader ETrade win the day?
Or will shareholders, Caledonia Investments with around 12.5 per cent and rival; online broker, IWL, with less than five per cent, continue to stay and frustrate the bank’s ambitions to mop up the 66 per cent of ETrade it doesn’t already own?
The ANZ entered the market to buy ETrade shares at $4.30 and lifted its holding to just over 42 per cent. That was after it declared the new offer final.
Normally a sweetened offer like the $4.30 now on offer from the bank, compared to the very skinny first offer of $4.05, would win the day But in these times of Qantas, Rinker and APN mega bids where shareholders have stood firm and opposed the deal, who can tell?
The $4.30 a share offer values ETrade at almost $432 million, which is inside the valuation range from Grant Samuel. The revised offer can be accepted in cash or ANZ scrip to an equivalent value.
The Grant Samuel report, released in late March said the ANZ $4.05 a share offer for was neither fair nor reasonable.
The valuer said ETrade was worth between $4.22 and $4.74 a share, or $424 million to $476 million. So the new offer is a bit on the skinny side seeing the stockmarket has been going gangbusters over the last month and looks like doing so for some months to come, at least.
ETrade’s directors had told shareholders to wait for the expert opinion before taking up the offer. They then rejected the $4.05 offer, leaving it to a battle of wills between shareholders and the bank, which blinked first.
“The independent directors of ETrade Australia have said they will recommend that ETrade Australia’s shareholders accept ANZ’s offer, as they intend to do for their own share holdings, all in the absence of a superior proposal,” ANZ said in yesterday’s statement.
The independent directors of ETrade Australia – Kerry Roxburgh, James Dominguez, Ian Hunter and Brett Spork – unanimously recommended that shareholders accept ANZ’s increased offer, in the absence of a superior proposal.
The independent directors said that the inclusion of a scrip alternative should enable some ETrade Australia shareholders to benefit from capital gains tax rollover relief.
ANZ said its offer has been extended to May 15.
The declaration that the price is final echoes the tactics in the much larger, $11.1 billion dollar takeover offer for Qantas, but at least the ANZ gave itself some wriggle room with its first price of $4.05.
Airline Partners Australia gave itself no such leeway in its Qantas bid, which was silly of them.
ETrade shares closed at $4.30 yesterday on more than 11 million shares as the ANZ gave notice it will buy shares in the market at $4.30. The bank produces its 2007 interim profit on Thursday. Its shares closed down 13c at $31.08.
