KEY POINTS:
Sir Anthony O'Reilly's consortium bidding for APN News & Media still believes it can reach the numbers for privatisation of the firm at a meeting of shareholders in Sydney on Friday, a source close to the consortium says.
But it expects the vote on its scheme of arrangement
and offer of A$6.20 per share will be a close call.
Some analysts and stockbrokers doubt the consortium - led by O'Reilly's Independent News & Media and including private equity firms Carlyle Group and Providence Equity Partners - can reach the numbers required for the scheme to go ahead.
INM owns 38.5 per cent of APN, publisher of the Herald, and for the scheme to succeed, it needs votes from 75 per cent of the shareholding not owned by INM.
Despite an almost-certain "no" vote by a key shareholder - Perpetual Investments - an INM source said the company was still committed to the meeting going ahead.
The consortium expected to win approval from enough shareholders to reach the 75 per cent barrier, the source said. It is understood that of the proxy votes already delivered - mostly from retail shareholders - around 80 per cent have approved the scheme with its offer of A$6.20 per share.
Retail shares make up around 15 per cent of the total shareholding so if that proportion of "yes" votes remains consistent, it would help the privatisation.
But the biggest obstacle for INM remains with Perpetual Investments, whose 13.4 per cent makes it the biggest investor after O'Reilly.
Perpetual has said that without a "material change"in circumstances it intended to vote against the scheme.
The fund manager yesterday refused to explain what would constitute a material change, but it implies a higher offer, which appears to be unlikely under the terms of the scheme that has been lodged.
While Perpetual owns 13.4 per cent of APN News & Media, it controls the votes for only 11.7 per cent of shares, which analysts have said would amount to around 20 per cent of the 25 per cent of non-INM shares needed to scuttle the scheme.
Some Perpetual investors are not allowing the fund manager to vote with their APN shares, adding credence to an Australian media report of shareholder dissatisfaction about Perpetual plans to block the scheme.
Another fund manager that says it will not sell is the Australian Foundation Investment Company with 1.7 per cent, which it is understood would amount to another 2.5 per cent of votes against the scheme.
Key to the success of the scheme will be fund manager Maple-Brown Abbot, which has 7.5 per cent in APN shares but has not yet indicated how it would vote. APN shares closed up 2c at A$5.80 yesterday.
