Treasury Wine Estates rejects takeover bid
Treasury Wine Estates has rejected a £1.7 billion takeover bid from private equity group Kohl Kravis Roberts.
Treasury, which supplies more than 80 globally renowned brands including Wolf Blass, Lindemans, Beringer and Penfolds, considered the offer but decided it was too low.
KKR put in a bid of £2.59 per share – a 15% premium on the close of play on Monday – and despite the rejecting it sent Treasury shares soaring 20%.
Treasury said in a statement: “Since commencing as TWE’s chief executive on March 31, Michael Clarke has been progressing with plans to improve the company’s performance, with a focus on improving brand prioritisation and investment, addressing structural challenges facing the business and reducing overhead costs.
“While these plans may drive potential asset impairments, they are fundamental to a turnaround in TWE’s short term performance and the company’s ambitions to deliver long-term sustainable growth.
“The board has considered the KKR proposal in the context of these renewed plans and concluded that the proposal does not reflect the fundamental value of the Company and it is therefore not in the best interests of shareholders.
“The board of TWE does not intend to take any further action in relation to the proposal.”