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29 October 2002
Last month Lowe Corporation Limited (Lowe) announced its intention to make a full offer under the Takeovers Code for Blue Sky Meats (N.Z.) Limited (BSM) at $4.50 per share. It later sent the offer document to shareholders in BSM.
Horizon Meats New Zealand Limited (Horizon) holds 37% (2,709,594) of BSM's shares and has a marketing contract with BSM.
Related to the takeover Horizon is to be paid $2.7 million for terminating the marketing contract and the transfer of trademarks. This is in addition to Horizon receiving the same consideration per share that is to be paid to other shareholders.
BSM's target company statement of 23 October said,
"… One shareholder (Horizon) may receive additional consideration for its shares which is different to the other shareholders …" and " … The effect of any over-compensation for terminating this contract could result in additional consideration being received by Horizon."
The Takeovers Panel considers that Lowe's offer for BSM may not comply with rule 20 of the Code because Horizon may receive more consideration for each of its shares than other shareholders. The Panel issued an order restraining Lowe from proceeding with its offer.
The Panel will meet in Wellington on Monday 4 November 2002 to consider the matter. The meeting will be a private meeting.
The Panel's notice of meeting and restraining order are published on the websitewww.takeovers.govt.nz.