Kingsgate Holdings Ltd, a subsidiary of the country's largest hotel operator, CDL Hotels New Zealand Ltd, today said it intends to make a full takeover offer for another CDL Hotels subsidiary Kingsgate International Ltd.
Kingsgate Holdings is 61.3 per cent owned by CDL Hotels and 38.7 per cent owned by Tai
Tak Holdings Pte Ltd.
CDL Hotels already holds 50.74 per cent of Kingsgate International. Tai Tak Holdings owns 31.79 per cent through its holding company Tai Tak Securities.
All three companies have undertaken to accept the offer for their shares in Kingsgate International.
CDL said today New Zealand Exchange Ltd had informed Kingsgate International that it does not meet the spread requirements under the Listing Rules.
In response to this, CDL Hotels said it and Tai Tak Holdings had formed Kingsgate Holdings "for the purposes of making the offer with a view to privatising Kingsgate whilst providing shareholders of Kingsgate with an appropriate exit mechanism".
The offer at 32c per share is at 10.3 per cent premium to their closing price yesterday and values the company at $125.8 million.
Kingsgate Holdings will compulsorily acquire the balance of Kingsgate International shares it receives 90 per cent or more acceptances for the offer and will delist the company.
CDL Hotels said the offer was subject to Overseas Investment Commission approval and the NZSX 50 Index not falling to a level equivalent to 10 per cent or less of its level on the date of the offer.
Kingsgate Holdings has appointed ANZ Investment Bank as financial adviser and Bell Gully as legal adviser in relation to the offer.
CDL Hotels is a subsidiary of global hotel group Millennium & Copthorne Hotels Plc, in turn half owned by Singapore property group City Developments. CDL Hotels operates 28 hotels in 15 locations around New Zealand.
CDL Hotels shares were unchanged at 44c in late morning trade today, while Kingsgate International shares were up a cent at 30c.
- NZPA
