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Treasury Wine Estates Ends 3.4bn Dollar Buyout Talks

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|Sep 29|magazine5 min read

Treasury Wine Estates, one of the world’s biggest wine producers and sellers, has ended talks and negotiations regarding the potential buyout of their company. The deciding factor in the decision was shareholders, who did not provide enough support for any of the proposals.

Kohlberg Kravis Roberts and CO (KKR), with junior partner Rhone Capital, and TPG Capital both put forward proposals for buyout consideration. About 50 percent of Treasury Wine Estate’s shareholder register agreed that the $5.20 price per share offer undervalued the company. The total of the offer was $3.4 billion.

A bidding war took place this winter, when what was believed to be TPG (the company was listed as a global private equity investor) threw in a bid for the winemaking company. The bid was worth the same as that by KKR and Rhone Capital, which was made just one week earlier.

After Treasury Wine Estates conducted their due diligence and takeover talks with all involved parties, the company announced that the non-binding, conditional offers would no longer be considered as viable. Treasury Wine Estates, along with its board and shareholders, believe more of the company’s value can be unlocked over time through their continued strategic transformation plans.

"Following the receipt of the initial, indicative proposals from the two parties, we believed it was in shareholders’ best interests to grant those parties the opportunity to conduct non-exclusive due diligence," said Treasury chairman Paul Rayner. "That process has now concluded and the board is confident in the strategic plans to grow the company and is looking forward to working with management to deliver value to its shareholders."

Information sourced from Business Spectator.