Burswood chairman Don Watt wrote to shareholders this week reaffirming the board’s recommendation that shareholders do not accept Publishing & Broadcasting’s takeover offer.
Mr Watt said PBL’s proposal to increase its offer by 6 cents a share to $1.46 was highly conditional.
Broking firm GoldmanSachs JBWere said in a research note that: “It does not appear to us that Burswood’s response is a complete rejection of the $1.46 offer.
“Rather, the conditions PBL has placed on its offer (i.e. 90 per cent acceptance condition) make it difficult for the board to accept.”
Mr Watt’s letter also discussed the impact of Burswood’s decision to pay a special dividend of 10 cents per share.
PBL said it would reduce the amount payable to shareholders by an amount equal to the “value of the dividend”.
Mr Watt said he assumed this was a reference to 10 cents per share, which was consistent with normal market practice, rather than the “grossed up” amount of 14 cents per share (including franking credits).
A spokesperson for PBL confirmed that the relevant adjustment would be 10 cents.
In recent trading, Burswood shares have been fairly steady around $1.43.
