CSR spurns Bright Food’s offer; prefers demerger
16 Jan 2010
CSR, Australia's second-largest maker of building products, yesterday rejected Bright Food Group Co's offer to buy its sugar and renewable energy unit for up to A$1.5 billion, saying that the demerger is the ''preferred option'' and is in the best interests of shareholders.
The company said it prefers to proceed with a spinoff of the business from its building material and aluminum units. CSR plans to carry out the spinoff by 31 March.
In a statement released to the Australian Securities Exchange (ASX) yesterday, CSR said it had considered the offer from the Chinese food giant - but its preferred option remained an existing demerger proposal for its sugar and energy business.
"CSR remains focused on maximising shareholder value," the statement said.
Early this week, the Shanghai municipal government-owned food producer Bright Food Group Co. said it is interested in the sugar and renewable energy business of CSR (See: China's Bright Foods bids $1.4 billion for CSR's sugar business).
Analysts see CSR's move as a tactic to enhance its valuations to get a stronger offer.