A stockbroker says shareholders in listed meat processing company Affco will be extremely disappointed with the takeover offer from privately owned food processing firm Talley's.
On Friday, Talley's, the largest shareholder in Affco, increased its stake in the company to 76% after buying the second largest shareholder's entire stake for 37 cents a share.
That stake was owned by Toocooya Nominees, the investment vehicle owned by the Spencer family, which has pulp and paper and meat farming interests.
Under the Takeover Panel rules, the move forces Talley's to make a bid for the entire compay,
A director of the stockbroking firm Hamilton Hindin Greene, Grant Williamson, says the low offer of 37c - the same price the stock traded at on Friday - indicates Talley's has no real intention of buying the whole company.
Mr Williamson says most current shareholders would not accept that offer.
Fifth largest shareholder will wait and see
Property investor Hugh Green, who through two investment vehicles is the fourth largest shareholder in Affco with a 2.5% stake, was unavailable for comment.
The co-founder of the realtor Barfoot and Thompson, Garth Barfoot, who is the fifth largest shareholder with nearly 1%, told Radio New Zealand he is not prepared to sell at 37c, and will wait and see if Talleys comes up with a better offer.
Affco has advised its shareholders to do nothing until its directors have considered Talley's offer and the assessment of an independent report on the bid.
This is the second time that Talley's has made a bid for Affco. In 2006, it boosted its stake to more than 50% and then offered 39c a share.