Rivals agree to part as GPG bids for all of Enza

By PHILIPPA STEVENSON, agriculture editor

The relationship of corporate investors Guinness Peat Group and FR Partners - which won surprise control of exporter Enza and transformed the apple industry - has completely soured.

Yesterday, 20 per cent shareholder GPG bid for full ownership of Enza, the former monopoly marketer and still the major exporter in a now-deregulated pipfruit sector.

FR Partners said it had agreed to sell its 20 per cent holding to GPG - subject to GPG gaining just over half of Enza's 60 million shares - but only after FR's own offer for GPG's stake had been turned down.

The moves follow February's acrimonious annual meeting when GPG executive director Tony Gibbs, deposed as Enza chairman last August by FR director Bill Birnie, attempted to turn the tables on his investor colleague and oust him from the Enza board.

After visiting Enza's Hastings head office yesterday, Birnie said that following the annual meeting it was clear to all other shareholders that GPG and FR had different approaches to the Enza business.

"It is not in the best interest of the company, its staff or its suppliers that there are two hands on the tiller," he said.

"We have reluctantly concluded that the best course for all parties is to accept the GPG offer."

Birnie said FR wanted to move quickly to change aspects of the business while Gibbs' style was more deliberate. He denied the board was dysfunctional, although that was grower-shareholders' perception.

FR was quitting Enza to ensure company stability, said Birnie. He said GPG was likely to easily reach the 50.1 per cent share threshold.

Gibbs said GPG was not bent on owning 100 per cent of the company but had bid for all the shares "in fairness to everybody".

"We desire to be the cornerstone shareholder [in Enza] and I think you're better off to have one cornerstone shareholder than trying to have two."

He said there were "operational differences" between the two investors but declined to detail them.

Both said listing Enza on the Stock Exchange was not a priority.

Gibbs said there would be few operational changes if GPG's bid was successful. The company would continue under chief executive Michael Dossor, a Gibbs appointment from one of GPG's other investments, Turners and Growers.

GPG and FR each got their stake in Enza in 2000 for around $6 million. GPG's offer yesterday of $1.20 a share - conditionally accepted by FR - will return the departing corporate just over $14 million.

GPG would need to spend just over $57 million to gain all the shares.

Last year Enza shares traded between 55c and 60c but recently a small parcel went for $1.10 a share.

Deputy chairman Brian D'Ath said yesterday that Enza's independent directors would commission an independent report on the merits of the offer for shareholders.

He recommended that shareholders not sell until they had considered the report.

In its latest annual report, Enza's net shareholder value was $77 million, and its gross operating revenue $640 million.

At the end of the financial year in September it had 1065 shareholders. All but about three held fewer than a million shares.