KEY POINTS:
An offer of about $8 million for the Designer Textiles International unit of textile design company Pod falls within the valuation range worked out by an independent adviser.
Ferrier Hodgson said its valuation of DTI was in the range of $6.1 million to $8.8 million.
Pod said a special meeting of its shareholders would be held on June 29 to vote on the offer for DTI from Melbourne's The Merino Company.
At the same time, LWR Manufacturing has served notice of its intention to make a takeover offer for Pod at 50c a share, valuing it at $22.5 million.
If LWR is to make a takeover offer, it must do so by June 30.
Pod said one of its reasons for holding a vote on the DTI sale was the possibility that a decision to sell could potentially frustrate the ability of shareholders to decide which proposal, if any, they preferred.
In a letter to Pod shareholders, chairman George Gould said DTI had been a prosperous business and, in recent years, a major contributor to Pod group earnings.
DTI sales revenue was now at a record high and prospects for growth were "great", particularly through export.
"However, we are finding it difficult to achieve satisfactory profitability when the dollar is so strong and our competition comes from low-cost manufacturers offshore," Gould said.
The Pod board believed TMC, which was well backed and with an international network of manufacturers, was in a better position to take DTI to the next level.
- NZPA
