The battle for control of Fisher and Paykel Appliances took a new turn today when China's Haier said a $1.28 to $1.57 per share price range put forward by the corporate advisers Grant Samuel was "overly optimistic".
Haier, which already owns 20 per cent of F&P Appliances, is offering $1.20 a share for the shares in the company that it does not already own.
Australian fund manager Allan Gray, F&P Appliances' biggest shareholder after Haier, has already accepted the offer by virtue of a lock-up agreement, giving Haier an effective 37.46 per cent stake.
Shareholders in F&P Appliances would need to decide between the certainty of Haier's offer or taking "a significant risk on the achievability of the Independent Adviser's valuation range," Haier said in a statement.
Haier believed Grant Samuel had placed substantial weight on F&P Appliances' five-year strategic plan in determining its valuation.
But Liang Haishan, chairman of Haier New Zealand Investment Holding Co, said there was "a high degree of risk" surrounding the plan. The independent board had given its conditional support to the offer when Haier revealed its intentions last month.
"We assume that the independent board of F&P Appliances, and their financial advisers, also considered the risks in implementing the five year strategic plan when they gave their conditional support to our offer of $1.20," Liang said in a statement.
Liang said Allan Gray's acceptance represented a strong endorsement of the offer.
While Haier was pouring cold water on Grant Samuel's valuation, the price action in F&P Appliances shares suggested investors expected the company to up the ante.
By 11.30 am, F&P Appliances shares were trading at a fraction over $1.22, up 2c from Wednesday's close.
F&P Appliances' chairman Keith Turner said earlier that the independent directors - himself, Philip Lough, Lynley Marshall and Bill Roest, had considered a full range of expert advice.
"The independent directors consider that Haier's offer of $1.20 per FPA share does not adequately reflect their view of the value of F&P Appliance based on their confidence in the strategic direction of the company," Turner said in a statement.
Forsyth Barr broker David Price said the market was playing a wait and see game.
"At the moment they (Haier) do not need too many people to get them over the line (50 per cent)," Price said. "They are already at 37 per cent so obviously the ball is firmly in Haier's court," he said.
"The price is certainly not in the range of the independent report so the market is just playing a wait and see game," he said.
Price added that heavy turnover in F&P Appliances reflected the view that Haier would indeed raise its offer.
Retail investors make up roughly 30 per cent of East Tamaki-based F&P Appliances' total shareholder base.
Qingdao-based Haier _ one of the world's biggest whiteware makers _ posted offer documents to shareholders last week and an independent report on the offer should be sent to investors by October 10. The offer closes on November 6.