Toll raises bidding to $5.4b
By Scott Rochfort
March 23, 2006
TOLL Holdings has goaded Patrick to detail its merger plans with Australia's second-largest road transport business - Linfox - after raising its takeover offer for the stevedore to $5.4 billion.
In an attempt to push the seven-month-old bid over the line yesterday, Toll removed the condition requiring it to snare 90 per cent of Patrick. That enables it to sidestep Patrick chairman Peter Scanlon and managing director Chris Corrigan, who own some 10 per cent of the company.
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Toll also tore up its original plans to unload Patrick's 62.4 per cent stake in Virgin Blue if its takeover succeeded, partly via an in specie dividend of 0.3 of the airline's shares to each Patrick shareholder.
Under the original deal, Virgin Blue founder Sir Richard Branson was to regain management control of the airline by buying back a 15 per cent stake from Toll at an underwritten price of $1.40 a share.
But Mr Little said Toll's change of tactics was a result of the recent recovery in the airline's share price and profit outlook.
"It's, from our point of view, a better business and that's obviously reflected in the price it's trading at," he said.
Mr Little was unclear on Toll's plans for Virgin Blue but the removal of any deal with Sir Richard in the takeover bid is seen as a move to focus all of the debate on the Patrick offer.
Toll has made it clear it may drive a harder bargain in handing back management control to Sir Richard. "It's all very hypothetical until we get control of Patrick," he said.
Yet Toll has not annulled the underwriting agreement with Virgin Group.
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