Goodman Fielder may have rejected this week's takeover offer but if the recent ownership battle over Warrnambool Cheese & Butter is any indication, the matter is unlikely to end there.
This week, Singapore food company Wilmar International and Hong Kong-listed investment management firm, First Pacific Company announced that they had submitted a non-binding all-cash offer of 65c per share for the joint acquisition of Goodman Fielder.
The all-cash offer valued the shares at $1.27 billion, a premium of 27 per cent to the average price of Goodman Fielder shares at the time, which had slumped since the food maker's profit downgrade on 2 April.
At the time Goodman Fielder, which makes Helgas, Meadow Lea and Praise-branded products, announced it would speed up its cost-cutting program, mostly through reduced headcount, as a result of deteriorating market conditions.
The company also said it was predicting lower than expected full-year financial results.
Goodman Fielder met with Wilmar and First Pacific over the weekend, and on Monday said the current proposal “materially undervalues Goodman Fielder and is opportunistic” given its depressed share price.
However, the company has not shut the door completely on a deal.
“The board of Goodman Fielder remains focused on maximising shareholder value and will be constructive in relation to proposals which are consistent with this objective”, it said.
In the meantime, Goodman Fielder said it would continue executing its strategic plan which includes accelerated initiatives under its “Project Renaissance” to deliver an additional $25 million in cost savings, primarily through headcount reduction in the fourth quarter of FY14.
Wilmar and First Pacific, however, remain undaunted, describing their offer as compelling for Goodman Fielder shareholders.
They've also said they would “continue to seek engagement with the board about entering into due diligence aimed at bringing forward a binding proposal to Goodman Fielder shareholders”.
Goodman Fielder's brands include Helgas, Meadow Lea and Praise.
