Alesco chairman Mark Luby has signalled the door is still open for further talks with paint maker DuluxGroup over its long-running $210 million takeover bid.
In response to a shareholder question at the building products company’s annual general meeting on Tuesday, Mr Luby said Alesco’s board would continue to keep its options open in relation to DuluxGroup’s “unsolicited, hostile and opportunistic” offer.
He said the board had always been open to talk to DuluxGroup, whose offer comprises $2.05 in cash per share and up to 42 cents in fully franked dividends.
DuluxGroup has said it will declare its offer unconditional once it reaches 50.1 per cent ownership of Alesco. It currently holds 48.25 per cent.
“If and when we get to the point with Dulux being at 50.1 per cent we will consider our options at that point in time,” Mr Luby told shareholders.
“Fortunately we’ve kept our options open all the way through and we’d be still prepared to sit down and talk.
“In fact the Dulux chairman and I had a cup of coffee together last Friday.”
Mr Luby faced sustained questioning by shareholders about Alesco’s position on the takeover offer, and was also quizzed about the decision to award shares or performance rights to managing director Peter Boyd.
Shareholders rejected a resolution to grant performance rights and shares to Mr Boyd, with 26.9 million votes against and 21.9 million for.
They also rejected Alesco’s remuneration report, with 29.1 million votes cast against and 19.7 million for at the meeting.
DuluxGroup and Alesco’s other major investor Wilson Asset Management voted against both resolutions.
Meanwhile, DuluxGroup chief executive Patrick Houlihan has welcomed Alesco’s willingness to engage in more talks.
“Alesco’s chairman has clearly signalled today that he has kept his options open and would be prepared to talk with Dulux if we obtain over 50.1 per cent of Alesco prior to 1 October,” Mr Houlihan said in a statement.
“DuluxGroup currently holds 48.3 per cent of Alesco and looks forward to discussing a supported outcome that is in the interests of all Alesco shareholders.”
In a trading update, Mr Luby said Alesco expected to report net profit for the first half of 2012/13 “well ahead” of the $1.7 million recorded for the previous corresponding period.
Net profit from continuing businesses in the first quarter was “in line” with the prior year despite the continuing decline in the market.
Mr Luby said Alesco’s earnings stood to benefit from cyclical improvements in the housing and renovation markets, which were currently at 10-year lows.
Alesco in July reported a net loss of $13.9 million for 2011/12, compared to a profit of $13.6 million the previous year.
It blamed the loss on a fall in approvals for detached housing and subdued renovation activity due to weak business and consumer confidence.
Alesco closed half a cent higher at $1.905, while DuluxGroup ended six cents lower at $3.27.
