Hirst bids for Feltex as going concern

And then there was one.

Australia's Godfrey Hirst has emerged as the sole bidder for carpet-maker Feltex.

McGrathNicol - which took control of the firm last week after Feltex's lender ANZ called in its $135 million loan - said Godfrey Hirst had submitted an unconditional offer to buy Feltex as a going concern.

Meanwhile, the consortium fronted by Graeme and Craig Turner, the principals of the Sleepyhead bedding group, had not submitted a bid.

"Godfrey Hirst wishes to acquire all of Feltex's assets and undertakings in New Zealand, Australia and the USA. The receivers are currently evaluating the offer and will announce further details in the next few days," Feltex's receiver, McGrathNicol partner Colin Nicol, said.

Nicol declined to comment on the specifics of the offer, but said it looked like it would achieve the receiver's objective of finding a strong owner by November, minimising any further damage to the business.

Godfrey Hirst declined to comment.

In the middle of last year, the Australian carpet maker offered to take over Feltex in a deal that would have valued the firm's shares at 60c, near the price they were then trading.

The deal was structured as a reverse takeover, which would have effectively resulted in the float of Hirst on the NZX.

Even though Feltex's shares were less than half the $1.70 at which they were floated in 2004, and the company could have benefited from a stronger balance sheet to help it reorganise, the board rejected the proposal.

Feltex ran into difficulty in April 2005 after it was hit by a sharp slow-down in the key Australian market.

Its shares were suspended from trade this week.

Hirst returned last August, offering to buy Feltex's assets for $141.8 million, in a deal that could have returned shareholders up to 12c a share.

Hirst pulled out this month, declaring itself unwilling to enter an auction with the Turners, who had also mounted a bid.

Hirst also said it had material concerns about the business following a thorough examination of the carpet maker.

The Turners said their consortium was not prepared to buy Feltex out of receivership.

"The bank was fully aware that our team was unlikely to wish to buy the business via a receivership process due to the significant damage caused to the reputation, value, internal and external relationships ... and our inability to assess the value impact of these consequences.

"We always understood that other bidders, who are competitors of Feltex, may well be able to accept these risks because they are less reliant upon Feltex remaining fully intact as a going concern."

The Turners maintained they had a deal with ANZ to keep the company listed.

Their proposal included a $63.5 million capital injection and the replacement of ANZ's funding lines with lines from the BNZ.

ANZ would have suffered a write-off of their loans, but this was not substantially different from the write-off already agreed with Godfrey Hirst.