The woman who will decide Cooper's fate

Discussion of Lion Nathan's failed takeover bid for the independent Cooper's Brewery and links to articles and other discussions.

The woman who will decide Cooper's fate

Postby Oliver » Sunday Oct 02, 2005 11:25 am

There's a big weight on this woman's shoulders.

If she sells to Lion Nathan (and it sounds like she will), she'll be arguably the most despised woman in South Australia.

Oliver

http://www.theaustralian.news.com.au/co ... 02,00.html

Woman controls brewery's destiny
Verity Edwards
October 01, 2005


THE future of Coopers Brewery could hinge on Adelaide philanthropist Mary Phyllis Henderson and the validity of a will signed by her mentally ill aunt allegedly in a psychiatrist's driveway nine years before she died.

Mrs Henderson is at the centre of a bitter family feud with her cousins and a long-running court dispute over ownership of 114,000 Coopers shares, worth about $30 million.

If a pending court trial determines her aunt did leave Mrs Henderson a crucial 8 per cent stake in the family-owned niche beer company, she has indicated she will sell it to Lion Nathan.

The multinational beer giant last month launched a hostile $352 million takeover for the tightly controlled family company, offering $260 a share, more than five times Coopers' last valued price.

The crucial parcel of disputed shares could provide Lion Nathan with a gateway to future share options and a possible takeover.

The fate of the company now rests in a Supreme Court trial. Acting Chief Justice John Perry said yesterday he would set a trial date for the case on November 4.

The news came as Coopers announced a record net profit of $14.3 million - nearly $5 million more than last year - and record revenue of $127.2 million, up 18per cent.

Mrs Henderson is fighting Executor Trustee Australia, which claimed the 1993 will naming her as sole beneficiary of the shares was invalid.

The executor alleged her aunt Phyllis Mary Rondahl, who died in September 2002, was suffering a mental illness when she wrote the last of three wills.

Ms Rondahl signed the new will in her psychiatrist's driveway just hours after she was discharged from a private Adelaide psychiatric clinic, according to its statement of claim.

It alleged she had been diagnosed with a "major depressive disorder with psychotic symptoms" and Parkinson's disease.

Executor Trustee claimed a 1991 will was the valid document.

That will left 25,000 shares to Mrs Henderson with the remainder divided between current board members William Thomas Cooper and Timothy James Cooper, and former chairman Maxwell Cooper, Rondahl's nephew. Justice Perry last week placed the disputed estate in the hands of an administrator, ruling that the shares could not be sold, and removing voting rights associated with the shares.

Even if Mrs Henderson gains control of the Coopers stake, she would not have automatic rights to sell the shares to Lion Nathan.

Under the Coopers constitution, each of the company's 117 shareholders must first offer the shares to other shareholders under a first rights agreement.

If existing shareholders choose not to buy, Mrs Henderson must then offer the shares to AMP, under a second rights agreement, at a "fair value" determined by an independent auditor. Lion Nathan can only buy shares under a third rights agreement.

But this would entitle it to become a valid shareholder - and thus gain the valuable first-rights status other shareholders have.

Coopers sought permission in August to hold a general meeting to consider changing its constitution and removing Lion Nathan's third-tier rights, after the giant signalled its takeover plans.

Justice Perry last week granted Coopers the right to hold a meeting, which has been scheduled for October 20.

Lion Nathan has appealed against the decision, and is seeking an injunction against the meeting in the Federal Court in Melbourne early next week.
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Postby Dogger Dan » Sunday Oct 02, 2005 6:22 pm

It sounds like she can't sell them to Lion, she has to sell them to the current stock holders first

Dogger
"Listening to someone who brews their own beer is like listening to a religous fanatic talk about the day he saw the light" Ross Murray, Montreal Gazette
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Postby r.magnay » Sunday Oct 02, 2005 7:48 pm

I bloody well hope so!!!!
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Postby Oliver » Sunday Oct 02, 2005 8:24 pm

Dogger Dan wrote:It sounds like she can't sell them to Lion, she has to sell them to the current stock holders first

DD,

That whole deal is currently subject to legal action.

Also, if current shareholders and the Cooper's superannuation fund don't buy the shares, the Lion Nathan would have third dibs on them.

It's a very complex arrangement that's in place!

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Postby Dogger Dan » Monday Oct 03, 2005 1:30 am

No,

I understand that part, but why wouldn't Coopers (currenty share holders)buy them? They seem to not want to go over to Lion so as far as I can see its all over. And that other witch couldn't get the cake Lion was offering anyway cause it was all illegal.

Maybe Lion should have a chat with Martha and reread his SOX.

Dogger
"Listening to someone who brews their own beer is like listening to a religous fanatic talk about the day he saw the light" Ross Murray, Montreal Gazette
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Postby NTRabbit » Monday Oct 03, 2005 2:02 am

Dogger Dan wrote:No,

I understand that part, but why wouldn't Coopers (currenty share holders)buy them? They seem to not want to go over to Lion so as far as I can see its all over. And that other witch couldn't get the cake Lion was offering anyway cause it was all illegal.

Maybe Lion should have a chat with Martha and reread his SOX.

Dogger


Im sure they would like to buy them back at first offer if she won the case, but raising the finances for it is an entirely different story.
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Postby Dogger Dan » Tuesday Oct 04, 2005 3:05 am

Not when you show a 15 million dollar profit every year

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Postby NTRabbit » Tuesday Oct 04, 2005 6:42 am

Dogger Dan wrote:Not when you show a 15 million dollar profit every year

Dogger


As a company yes, but the shares are offered to the shareholders, not the company. Since that 15 million profit doesnt slide straight into anyones pocket, its a little bit more difficult.
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Postby Dogger Dan » Tuesday Oct 04, 2005 8:24 am

NT,

Maybe I am seeing this wrong but Coopers isn't publicly traded right, so....everyone who has shares are pretty much family and are all onside. Even the Grand mam with the Altzheimers wouls have been onside. Assuming this is right I would assume Dr. Tim has one or two also.

So make the issue go away, Borrow against, buy the shares, grow the company, pay back the bank. Make it the biggest and badest thing ever to come out Australia and buy Lions ass out in couple of years.

I am Canadian and I could find a few dollars for a venture as worthy as this.

But then I live in production where we make miricles happen daily, we no longer just walk on water, we freeze it behind us for others to follow.

It couldn't be this easy.

Dogger
"Listening to someone who brews their own beer is like listening to a religous fanatic talk about the day he saw the light" Ross Murray, Montreal Gazette
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Postby Tyberious Funk » Tuesday Oct 04, 2005 12:13 pm

Dogger Dan wrote:It couldn't be this easy.


The main issue seems to be that the shares that are offered to other shareholders must be sold at a "fair value". This price is to be determined by an independent auditor. Now, according to the article, Lion Nathan are putting in a bid at around FIVE times the last estimated value of the shares. You'd imagine then, that an auditor would determine a "fair value" to be at least SOMEWHERE close to this... afterall, the "value" of something is really only what someone is prepared to pay for it. And Lion Nathan have shown that they are prepared to pay a LOT.

In other words, the Cooper family would be expected to pony up some serious green...
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Postby Dogger Dan » Wednesday Oct 05, 2005 2:45 am

See,

Thats what I don't get,

Fair Value is exactly that, fair value. If Nathen wants to pay 5 times fair value then thats his bussiness (and is pretty stupid really although I understand the reason) but it shouldn't be thrown into the mix to calculate fair value by an independent auditor, fair value can only be done on the worth of the company in this world today

For example, you are more than welcome to pay 220 K for a 140 K house. The market value for the house is still 140 K and you are an idiot for buying it at 220 K.

Additionally, Coopers can buy the stock back at fair value, so Nathen is in Double Jeopardy from what I can see

But things are very simple in my world and most issues can be solved with a dig stick

Dogger
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Postby Oliver » Wednesday Oct 05, 2005 11:09 am

I concur with you, Dogger.

But the way the Cooper's company operates is unusual in that anyone selling shares can call for an independent valuation of the company, and they are then bound to sell the shares, if they decide to proceed, at that price.

Strange but true.

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Postby pharmaboy » Wednesday Oct 05, 2005 4:54 pm

Dogger,

the market value of a house is what someone (anyone) is prepared to pay, if your 140k house has an offer on the table for 220k (say by a developer that owns all 4 neighbours) then that is the fair value of the house.

Lion Nathan arent stupid and have put in this grossly overdone offer in order to become shareholders, then take it bit by bit from there. Not much question, if the offer isnt restrictive, AMP will have to pay full whack, and members of the coopers family are unlikely to stump up $250 a share for something worth half that.

If LN win their court case, I think you'll find coopers been publicly listed quite soon - the best form of defense is attack - so opening to the open market will be the way to stave off LN i think.
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Postby Dogger Dan » Thursday Oct 06, 2005 3:08 am

I guess it is the definition of fair market value but then, what he is doing smacks of Emron where the company was over rated.

Dogger
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