Electrical appliance maker Breville has rejected a takeover offer from GUD, saying a report given to the company analysing the offer has found it is too low.
GUD, which owns the Sunbeam brand, launched its all-scrip bid for Breville in early October.
GUD already owns 19.4% of Breville and managing director Ian Campbell said at the time of the bid that his company’s bid already had the support of several key institutional investors, who control a total of 28%.
But the Breville board is looking for a higher bid.
“The Breville board has carefully assessed GUD’s offer and each director has decided to reject GUD’s offer in relation to their own shares in Breville,” chairman John Schmoll said in a statement.
“The board also unanimously recommends that Breville shareholders reject GUD’s offer.”
Meanwhile, finance minister Lindsay Tanner has said the Federal Government will be making more tough decisions next year for the 2009-10 budget, citing a need to pay down the deficit.
“The mining boom generated a lot of froth in the nation’s finances,” Tanner said on Network Ten on Sunday. “It artificially pumped up tax receipts in a range of areas like company and capital gains tax.”
Despite expectations of good GDP growth next year, Tanner said, the Federal Government must focus on paying down a deficit that could reach as high as $60 billion by next year.
“There are going to be some tough decisions,” he said.
Shares open higher after good week on Wall Street
The Australian sharemarket has opened higher today after good results from Wall Street last week, where financial reports from major retailers last week increased investor confidence.
The benchmark S&P/ASX200 index was up 30.3 points or 0.64% to 4736.7 at 12.15 AEST. The Australian dollar also moved higher to US93c.
Commonwealth Bank shares increased 0.6% to $54.65, while Westpac shares fell 0.5% to $25.70. NAB lost 0.4% to $28.76, as ANZ also lost 0.9% to $22.28.
Toll road operator Transurban Group has said it is open to takeover offers, but only if they provide an appropriate value and guarantees to the company’s shareholders.
Chairman David Ryan has said in a letter to shareholders that any proposals would be welcomed, after rejecting a $US4.4 billion non-binding joint proposal from the Canada Pension Plan Investment Board and Ontario Teacher’s Pension Plan, saying the offer was “highly conditional”.
“Simply put, the proposal failed to recognise Transurban’s performance, our irreplaceable portfolio of toll road assets and our indisputably critical infrastructure that helps deliver growth in key cities in Australia and the US,” Ryan said.
Elders has recorded a statutory loss of $466.4 million during 2009, with an underlying loss after tax of $51.7 million. Revenue dropped 11% to $3.04 billion, pro forma gearing of 32% to 30 September.
“We start the new year recapitalised and able to concentrate fully on realising the earnings improvement opportunities we see in our business”, Elders managing director Malcolm Jackman said in a statement.
“As we expected, trading conditions have continued to be challenging and our results for the fifth quarter are right on track with what we forecast for the period.”
Babcock & Brown Infrastructure said it has received confirmation from the Royal Bank of Scotland that it will not put forward an alternative recapitalisation proposal for the existing $1.8 billion plan expected to be voted on.
“While there has been strong interest in developing an alternative to the current recapitalisation proposal, at this stage an alternative capitalisation will not be submitted to BBI,” RBS Australia and New Zealand chief executive Stephen Williams said in the letter, posted on the ASX.
“If the current recapitalisation proposal is not approved at the meetings on 16 November 2009, an alternative proposal may be developed.”
In a statement of its own, BBI said it would “take considerable time to develop any alternative proposal”.
Meanwhile, telco giant Telstra has announced a plan to reduce carbon emissions for every dollar earned by at least 10% over the next six years.
“We are setting a realistic and achievable target for carbon intensity because we are serious about reducing our impact on the environment,” chief executive David Thodey said in a statement.
“Our customers, employees and the community increasingly expect us to act, and as the owner of infrastructure that is vulnerable to harsher climatic conditions it is in our interests to do so.”
This new target will require Telstra to reduce their emissions to 58 tonnes per million dollars by 2015.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
