Capilano Honey Ltd (ASX: CZZ) has reported its FY18 financial result and also revealed that it has received a takeover offer for $20.06 per share.
Capilano is one of Australia’s largest honey businesses with many recognisable products on supermarket shelves.
The company said it has entered into a scheme implementation agreement with a consortium, comprising Wattle Hill RHC Fund 1 and ROC Capital Pty Ltd, for $20.06 cash per share. This is a 28.2% premium to the last closing share price of $15.65.
Shareholders also have the option of receiving shares in the new private company instead of cash. The Capilano Directors have unanimously recommended the scheme.
“The Consortium will bring added capability to build our brands on a truly global scale,” Managing Director of Capilano, Dr Ben McKee, said.
“In particular Wattle Hill’s strong relationships in Asian markets provides an opportunity to unlock the potential of Capilano Group’s premium and therapeutic brands.”
In Capilano’s financial report it revealed:
- Revenue growth of 4% to $138.5 million
- Net profit up 4.9% to $9.8 million
- Dividend per share up 5% to 42 cents
According to Bloomberg, analysts were expecting a profit of $9.5 million, so this result appears to have beaten expectations.
Chairman Trevor Morgan said “This profit result was achieved by improvements to total gross profit, control of expenses, improved costs of production and increases to packing volumes that delivered the benefits of scale.”
A shareholder meeting is expected to be held in November 2018 to approve the deal. If agreed, the takeover is expected to happen by the end of December 2018.
Investors seem to think the deal is going ahead with the Capilano share price up by 26% so far in early trade.
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