Veteran retailer Solomon Lew and his investment company Premier Investments look certain to decide the fate of GUD Holding’s $300 million bid for electrical appliances group Breville.
GUD, which owns the Sunbeam brand, launched its all-scrip bid for Breville on Friday. The deal would give GUD the ability to expand its consumer electrical business outside of the Australian and New Zealand market; as a licensing agreement with the owner of the Sunbeam brand restricts GUD from selling Subeam outside this local patch.
GUD already owns 19.4% of Breville and managing director Ian Campbell says his company’s bid has already has the support of several key institutional investors, who control a total of 28%.
That gives GUD 47.4% of the company, as long as a higher bid for Breville does not emerge.
However, there is growing speculation that Lew and Premier, who control just over 30% of Breville, could be considering a rival bid. Premier’s website says the company has “approximately $300 million cash available to invest in opportunities which leverage Premier’s expertise”.
Premier is the owner of the Just Group, which includes the Just Jeans and Jay-Jays chains.
So far, Lew and Premier have not made a formal response to the GUD bid.
The proposed deal values Breville at $2.20 a share, a long way above the low of 46.5c the shares hit in March this year in the depths of the financial crisis.
The stock soared 59c on Friday to $2.09 following the announcement of the deal and were at $2.10 is morning trade.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
