M&a - Lion Nathan Case Study Essay examples

2515 Words Feb 5th, 2010 11 Pages
Prepare a brief chronology of the key events that occurred during this takeover offer. Sep 1, 2005 Lion Made offical offer to take offer cooper offering $260/share for cooper shares Sept 1, 2005 Cooper board of director going to meet and discuss this offer, no action should be taken at this time. Sept 06, 2005 Board of Director of Cooper recommend shareholder should reject the offer Takeover panel review Sept 1, 2005 appeal by Cooper about Lion offer that does not explain the preemptive right. Panel ask Lion to make a join letter to explain the preemptive right Sept 09, 2005 appeal by Lion appealing that Cooper explanation of fair value in the statement of Cooper articles is misleading Sept 21, 2005 …show more content…
Outline the key reasons put forward by Lion Nathan that Coopers Brewery shareholders should accept its offer and provide your opinion as to the validity of the reasons and the extent to which Coopers Brewery shareholders should accept the offer based on those reasons. Key reasons put forward by Lion Nathan: Significant premium It is true that the offer price of $260/share gives a substantial premium compared to the last transaction of the share that priced $45 on 2003, moreover the final offer of $310/share give a high valuation based on independent analyst that give $280 low valuation and $320 valuation. Moreover the price reflects 13.7 multiples of 2006 forecast EBITDA of $31.6 million. Based on the last offer I believe a lot of shareholders should be tempted to sell their shares and I believe it is an opportunity to good to pass since the price reflect the price of the company if Cooper is a public company maybe higher than it would be. Private Equity Company like Cooper should have been given 20-30% discount to its share price if we consider the liquidity and lack of disclosure risk. Rare opportunity to access substantial cash proceeds It is true that it is rare to get substantial cash proceeds with good price for the shareholder, since the company is private and the share is not liquid. Nevertheless, Cooper has been giving high dividends and return to its shareholder each year. Rare opportunity

Related Documents