Maple Leaf Foods is giving Schneider Corp. shareholders more time to consider Maple Leaf’s bid to take over the hog processing company.
The company announced Dec. 5 it would move the deadline for its hostile takeover bid to Dec. 16 from Dec. 6.
The move is a response to comments from Schneider officials that the takeover bid did not leave them enough time to explore other alternatives for shareholders.
Maple Leaf announced Nov. 14 it would pay $19 for each outstanding share in rival Schneider Corp., a bid worth about $129 million.
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Schneider officials and the Schneider family, which controls most of the company’s voting shares and 17 percent of the non-voting share, rejected the offer on Nov. 24 because they said it was too low and came at an opportunistic time.
But the chief financial officer of Maple Leaf defended the offer.
“It represents a 40 percent premium to the pre-bid share price, and is higher than the all-time pre-bid share price high,” said Tom Muir in a news release.
Schneider has opened a data room of detailed company information to lure other potential buyers. Fletcher’s Fine Foods Ltd. and Saskatchewan Wheat Pool have explored separate and joint offers. As well, Hormel Corp. and Kraft Foods are said to be looking at the opportunity.
On Dec. 3, Schneider officials adopted a temporary shareholders’ rights plan to protect the company from a takeover and to buy time to find other ways to increase value for shareholders.
If Maple Leaf or another bidder buys 10 percent of Schneider shares before March, the plan, a so-called “poison pill,” would see new shares issued, that would dilute the value of shares held by the party attempting the takeover.
But Maple Leaf said its lawyers believe the shareholders’ rights plan is invalid because it doesn’t comply with the Ontario Business Corporations Act.
