SunRice shareholders thwart Ebro takeover bid

A late revolt by rice growers in New South Wales, Australia today saw Spanish giant Ebro Foods's $610-million bid for the SunRice Group thwarted which left support for the move at a less than the required 67 per cent.

The bid required 75 per cent of A class shareholder support before being consideration by B class shareholders, who were in favour of the deal by 76 per cent to 24 per cent.

The deal needed 75 per cent support with both classes.

A big group of A class shareholders, who according to analysts were rice growers, and had been offered $50,000 each by Ebro to vote in support of the bid, in line with the SunRice board's recommendation, turned up to vote personally to reduce the proxy majority of 71.3 per cent down to 67 per cent. Under a clause in the proxy arrangements, proxy voters would be able to change their vote on the day if they came to the Riverina town to vote.

Chairman Gerry Lawson, who gave growers negatives as well as positives from the deal before the actual vote, said that the fact B class shareholders had actually achieved the requisites majority meant ''the result will be a disappointment for them''.

He admitted the unwieldy shareholder structure, which effectively paralysed the vote despite one class of shareholders being overwhelmingly in favour would be looked into at some future date. Lawson added that he and the SunRice board intended to seek to to maximise value from growers and shareholders from the options available.