Independent directors pan Dairy Trust offer

The independent directors of Open Country Cheese have panned a takeover bid from Affco subsidiary Dairy Trust for failing to take the Waikato-based quality cheesemaker's future prospects into consideration or supply a cash alternative to its scrip-only offer.

Open Country chairman Duncan Milne said an initial assessment by the independent directors ahead of an independent adviser's report had found Dairy Trust's offer on 1.68 Dairy Trust shares for each Open Country Share - which it valued at $2.25 - was "inadequate". "As independent directors we have just got to make sure the swap rate is a fair one," Milne said.

"We want the independent adviser to advise on the fact that it's only scrip for scrip and not a cash offer."

He also said Open Country shares had traded much higher than $2.25 in the past.

Milne and his fellow independent directors will also urge the Open Country board at its meeting in 10 days to release the company's forecasts to all shareholders.

"The independent directors intend to seek board approval to release to shareholders financial projections for the current and subsequent financial years as soon as is practically possible.

"We haven't decided ultimately to do it but we will be recommending it to the board meeting."

Affco's own independent assessment of the offer found that it was fair to its own shareholders not associated with the proposal, but noted there were no forward projections for Open Country available beyond May 2007.