Australia: Coopers qualifies Lion’s Nathan takeover behaviour as being desperate

Coopers Brewery is calling on the board of Lion Nathan to rein in its chief executive Rob Murray, after describing his tactics relating to its hostile takeover bid as "desperate", Sydney Morning Herald said on November 10. Coopers is resisting with force a $352 million takeover bid from Lion Nathan - a bid which was characterised by numerous court cases over the process by which Coopers shares are bought and sold.

Coopers released a statement in which it said "The Coopers board calls on Lion Nathan and its directors to rein in the desperate tactics of Robert Murray, including what appear to be endless and costly court applications, clear the air and let Cooper's shareholders get on with the business of considering the Lion Nathan bid and the future of their company”.

Sources close to Coopers have stated that they believe Lion Nathan's actions highlight what can only be described as the “most desperate tactics undertaken by a bidder in an Australian takeover."

Coopers managing director Tim Cooper said he was continually surprised by the lengths that Lion Nathan was going to, to take control of Coopers. "The level of hysteria from Robert Murray seems to increase daily," Dr Cooper stated.

Dr Cooper affirmed also that Coopers had been told that Lion Nathan's growth forecasts were not good and that Lion Nathan had panicked when Coopers tried to have Lion Nathan removed from Coopers' constitution. "This is the reason why it is acting in such a desperate way," Dr Cooper afirmed.

Dr Cooper said some sources close to Coopers had suggested that obtaining Coopers was the only way Lion Nathan could grow its beer business. He said Lion Nathan had attacked "any person involved in this takeover battle", including Cooper's auditor KPMG over its assessments of "fair value" for Coopers shares, and the Coopers board. Lion Nathan would have been pressing for an explanation from the Coopers board over some of the share trades engaged in by some Coopers directors.

"While Coopers is inexperienced in public takeovers, we do not think this sort of behaviour is necessary or appropriate," Dr Cooper said.

Mr Murray said on November 9, that Lion Nathan's bid for Coopers was likely to be "long, drawn-out and protracted". Under a pre-emptive rights regime in the Coopers constitution, Coopers shares up for sale must first be offered to Coopers shareholders, then to AMP or Coopers superannuation schemes, and thirdly to Lion Nathan.

Coopers is seeking to remove Lion Nathan's pre-emptive rights. It has won a court battle allowing it to do so but must also obtain shareholder approval.

Lion Nathan won a court injunction stopping a meeting of Coopers shareholders from taking place to consider the removal of Lion Nathan's rights.

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