Media star

[Oliver]

So, Frank, who's feeling like a national media star today?

 

 

 

Coopers fights off takeover bid

KERRY O'BRIEN: It's the last of Australia's major brewers still under family control with a devoted following across the country. But Adelaide's historic Coopers Brewery is fighting tooth and nail to fend off a $420 million takeover bid by multinational beer giant Lion Nathan. Two key developments this week seemed to take Lion Nathan a step closer to ownership. Although today, an extraordinary general meeting of shareholders agreed to allow the company to buyback 15 per cent of its own shares. The question is, will Cooper shareholders remain faithful when the crunch comes? The 7:30 Report's finance editor Emma Alberici peers into the froth and bubble.

 

EMMA ALBERICI: It's a ritual played out at pubs and clubs all over the country. Roll it gently or give it a quick turn before opening - the simple rite of passage to the Coopers cult.

 

FRANK AKERS, COOPERS CLUB: It's a real loyalty and a genuine love for the beer and a love for the Cooper family, I think, really.

 

EMMA ALBERICI: Frank Akers is the Coopers Club coordinator keeping in regular contact with its 10,000 members who share a common interest in making and drinking the cloudy ale.

 

FRANK AKERS: The people who just love drinking the bear, they get together and do what people do when they drink beer. But they are drinking Coopers.

 

MAN #1: It's a great taste and it's good to have after a long day at work.

 

WOMAN #1: I went overseas and I found I really missed Coopers pale ale.

 

EMMA ALBERICI: A key part of the Coopers tradition has to do with the brewery's owners. It was founded by Thomas Cooper in 1862. He had two wives and 19 children who've passed their share holdings down through the generations. In South Australia, the Coopers name is highly revered.

 

FRANK AKERS: Tim and Glenn, especially, are very much treated like celebrities when they go along to a club night, but they really are genuine people who love to have a beer. They love brewing it and selling it, but they love to get along and have a beer with club members.

 

TIM COOPER, MANAGING DIRECTOR, COOPER'S BREWERY: We do emphasise that we think that the company's future prospects and the financial performance are best with the family management - the existing family management.

 

EMMA ALBERICI: Tim Cooper isn't keen to contemplate a life without celebrity, but if a takeover plan for the company goes ahead, he, his half cousins, father and sister could well be out of a job.

 

TIM COOPER: We would say categorically it's get nothing to do with shoring up the interests of the directors, but it's a matter of looking to the best interests of the shareholders.

 

ROB MURRAY, CHIEF EXECUTIVE, LION NATHAN: It is true to say there are large factions of the Cooper family that don't want this, but it is important to remember also there are some shareholders we know, who would like to sell to us. So, I guess that's the situation that we're in.

 

EMMA ALBERICI: It's been three months since Lion Nathan, owner of brands like XXXX, Tooheys and Hahn, launched its $352 million takeover for Coopers, which has since been revised to $420 million. It's been a most extraordinary battle for control of an unlisted public company, whose 117 shareholders have held their shares for so long they had no idea what they were worth. Now with $310 per share on the table, saying 'yes' to Lion Nathan could well make many of them instant millionaires.

 

DREW CROSSLAND, COOPERS SHAREHOLDER: Never in my wildest dreams did I think they would get to the price that they are now.

 

EMMA ALBERICI: Drew Crossland has held his shares since the 70s, when his mother, a Cooper, died. Today, he's among a group of shareholders keen to sell and cash in their inheritances.

 

DREW CROSSLAND: I'm encouraged to sell my share for fair market value to whatever offer is out there. Lion Nathan have put the offer up and that's the only offer I see at the moment that I can find, or I can see, that's fair and reasonable. So, yes, I would accept that offer.

 

EMMA ALBERICI: The Coopers board told shareholders they couldn't sell until the competition regulator had made a decision about the takeover. This week the ACCC gave the Lion Nathan bid the thumbs up, but the directors are still refusing to budge.

 

TIM COOPER: We think that the future prospects of the company are great in the current - the hands of the current management - and that, clearly, many of the shareholders are saying to us that they value the association with the company, the heritage, the fact they can trace their lineage back to Thomas Cooper, the founder of the company, and those are the sort of things that they think are important to them.

 

EMMA ALBERICI: There's something a little odd about a company director recommending shareholders knock back an offer to buy their shares at a price determined by an independent valuer to be fair and reasonable. Under the corporation law, directors are supposed to about in the best interests of shareholders. In a takeover that means extracting the best possible price. Coopers own auditors, KPMG, came to the conclusion that without the Lion Nathan bid, the shares would be worth $190. So it is astonishing that the board is saying $310 a share is not enough, when just last year Tim Cooper himself was buying shares from Coopers shareholders at $45. That's 589 per cent or about six times less than the Lion Nathan bid. Those who sold might be feeling a little ripped off.

 

TIM COOPER: I don't know about being ripped off, but at the time, $45, nonetheless, did seem quite a big step up to us, as shareholders, from what it had been previously. It was a figure that was arrived at by KPMG when we asked them to do a valuation of shares.

 

EMMA ALBERICI: Just how independent KPMG is, is up for debate, considering the accounting giant is also the Coopers auditor. You've offered $310 a share, which seems an extraordinary amount of money when you consider that some of the members of the board were paying $45 a share only a year ago, to purchase shares.

 

ROB MURRAY: That's right. Yeah, it's true. I mean five years ago, they were paying $16 a share. So, it is extraordinary. We believe it's a fair offer, though, for the company.

 

EMMA ALBERICI: Family members outside the inner circle, like Drew Crossland, are furious about what they see as the inequity of recent share sales to company directors.

 

DREW CROSSLAND: I don't think it's any coincidence that the directors themselves have been buying up the shares. They've got privileged information of what's going on in the company, and every time shares seem to come on the market, they seem to buy them.

 

EMMA ALBERICI: In their continuing attempts to kill off the Lion Nathan bid, today directors put an alternative proposal to shareholders at an extraordinary general meeting at head office that media weren't allowed to attend. Directors suggested the company would buy back 15 per cent of the shares at $260 each, for those who wanted to sell. Supporters wore badges that screamed: "It's not about the money". And clearly, it's not, considering directors are offering $50 a share less than the Lion Nathan bid and more than 75 per cent of shareholders voted in favour of it.

 

MAN #2: We're very impressed with what this board does.

 

ROB MURRAY: There really is no independent voice, amongst this board of directors, offering those smaller shareholders in Coopers the type of guidance that I think they need.

 

EMMA ALBERICI: The whole saga could come to an abrupt halt next week when shareholders will be asked to vote again - this time, to change the Coopers constitution, in such a way that would completely scuttle the Lion Nathan offer and never again allow a rival brewer to buy shares in Coopers. The resolution was supposed to be put to shareholders today, but the takeovers panel prevented it from going ahead because it considered that Coopers had sent shareholders information that was materially misleading. They've all now been given extra time to consider if they really want to give up their last chance to sell shares to a competitor.

 

DREW CROSSLAND: What I would say to other small shareholders is leave the door open, not necessarily for Lion Nathan, but for other people to get a fair price for their shares.