The board of Tasmanian-based salmon farming company Tassal Group has rejected a bid worth $1 billion because they think the offer is not in the best interests of shareholders.
Canada’s Cooke Inc revealed a $4.85 per share offer yesterday but the Tassal Board says it will not pursue the offer any further.
News of the offer saw Tassal shares rise more than 16% to $4.61 by the close on Tuesday.
Market traders say Cooke was sniffing around rival Huon which was eventually picked up by the Brazilian protein giant, JBS for $425 million earlier this year.
Cooke is privately-held, Canadian-based seafood company and its offer price was a 22% premium to Tassal’s close on Monday of $3.97.
Cooke’s offer values Tassal at just over $1.04 billion.
Cooke disclosed it had bought a 5.4% stake in Tassal after the market close Monday. The Canadian-headquartered company reported it has obtained Foreign Investment Review Board (FIRB) approval for the offer.
This isn’t the first time Cooke has bid for Tassal. It’s offered two prior indicative non-binding confidential proposals, the first for $4.67 a share and the second at $4.80 a share.
After evaluating the earlier proposals, the Tassal Board opted not to pursue them and on Tuesday made its opposition to a buyout clear:
“The Company’s Board of Directors believes Tassal has an attractive independent future and is well positioned to deliver growth in shareholder value. The Board of Directors and management team remain focused on building on the company’s long history and delivering on our strategic objectives,” Tassal’s board concluded.