Fonterra's hostile $1.5 billion takeover offer for Australian dairy company National Foods has finally been sent to shareholders.
In the offer documents, Fonterra chairman Henry van der Heyden says the closing date for the bid is December 21.
He also reiterates Fonterra's argument that the $5.45 per share cash priceoffers a substantial premium on the pre-bid price.
The offer documents point out that Fonterra's existing stake of about 19 per cent makes it unlikely that a rival bidder will appear. They also warn that the share price may drop significantly if the offer is unsuccessful.
Not to be outdone, the National Foods board of directors has sent its own letter to shareholders reminding them that they have rejected the offer. National Foods also disclosed it would hold another shareholder meeting in Adelaide.
Earlier shareholder meetings in Sydney and Melbourne appear to have been successful in drumming up small shareholder opposition to the bid.
Fonterra is aiming to take its stake in National Foods to at least 90 per cent, allowing it to take total control. It is prepared to live with majority control if that is all it can get.
Small retail investors are estimated to hold about 30 per cent of the shares. The rest are mainly held by financial institutions.
National Foods shares have traded above $5.70 for the past few weeks and Australian analysts believe Fonterra may need to up its offer in order to succeed.
National Foods shares closed at $5.74 yesterday, up 1c for the day.
