Goodman Fielder called bid "opportunistic"

Goodman Fielder called bid "opportunistic"

Australia-based food group Goodman Fielder has rejected a takeover bid from Singapore agribusiness giant Wilmar International - a shareholder in the business - and Hong Kong investment firm First Pacific.

Goodman Fielder, the owner of brands including Meadow Lea spreads and Helga's bread, said the A$1.27bn (US$1.18bn) bid "materially under-values" the business.

Wilmar - which owns 10.1% of Goodman Fielder - and First Pacific had put forward what the takeover target called a "highly-conditional proposal". The conditions included "exclusivity in relation to the proposal", Goodman Fielder said.

"The board of Goodman Fielder carefully considered the proposal, together with its advisers, and has met with representatives of Wilmar and First Pacific over the weekend," Goodman Fielder said today (28 April).

"The board believes that the current proposal materially under-values Goodman Fielder and is opportunistic. The board has advised Wilmar and First Pacific accordingly."

Earlier this month, shares in Goodman Fielder plunged more than 20% after it announced it would not meet its profit expectations for the 2014 financial year.

Goodman Fielder has had a challenging few years with profits and sales under pressure. It said it "remains focused on maximising shareholder value".

It is looking to cut jobs to help lower costs by A$25m. The company also said it was reviewing the options for its dairy business in New Zealand and started to look at ways to "optimise" its daily deliveries of fresh bread.

Wilmar took its stake in Goodman Fielder from 5% to 10% two years ago, sparking speculation over its intentions towards the business.

Speaking to just-food at the time, Wilmar said it was "too early to comment" on what it hoped to achieve from its investment. Asked why it had increased its stake, Wilmar said it has "always been open to new business opportunities" and added: "Goodman Fielder’s leading consumer brands in baking, dairy, home ingredients and edible oils across Australia, New Zealand and Asia Pacific are of interest to Wilmar."

After two years of losses, Goodman Fielder returned to the black in its last financial year, which ran to the end of June 2013.

Nevertheless, underlying EBIT from continuing operations fell more than 8% during the year. Revenue from continuing operations fell 3.9% to A$2.13bn thanks to lower sales volumes from Goodman Fielder's bakery and grocery products.