Hurdles ahead for Saab's offer to Grintek minoriti
Hurdles ahead for Saab`s offer to Grintek minorities
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Trade and Industry Editor
TECHNOLOGY group Grintek`s Swedish shareholder, Saab, appears likely to face some opposition to an offer to buy out minorities for R1,70 a share.
The share has rallied since the announcement earlier this month that Saab was considering making an offer , from about 127c a few days before the announce ment to 180c last week.
Grintek CEO Shaun Liebenberg says 170c a share represents a premium of more than 33% over the average price at which the stock was trading in the 30 days before the announcement. The suggested price was also slightly higher than the 160c a share that Saab had paid when it acquired 21,2% at the end of last year. Analysts were hesitant to register opposition before an actual offer was made.
But most analysts wanted to see the benefits of the improvements being engineered by Liebenberg, who came on board in March.
They also expected to see further benefits from Grintek`s alliance with Saab, which is a hi tech company that has extensive global reach in the defence industry.
One analyst said it was hard to determine the right price because Grintek was a complex technology company that had seen big foreign-exchange swings.
The possible Saab offer would again exclude the shares owned by the five Kunene brothers through Kunene Finance and Kunene Technology Investments.
The Kunene shareholding has been reduc ed to 25% from about 33%, in line with Saab`s previous purchases of Grintek shares.
Analysts consider the Kunenes good empowerment partners for Grintek. Liebenberg said last week he and Saab officials were investigating a possible offer.
He said an announcement could be made any time between now and early next year. One analyst said his group would meet Saab representatives in the next week or so.
Liebenberg`s tidying up of the company included several changes in management. He said the right team was now in place, with only the appointment of a new finance director still outstanding.
Grintek reported a 4% decline in revenue to R1,4bn, and a 28% fall in operating profit to R60,8m for the year to June.
But headline earnings jumped 131% to R52,9m.
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