SIG invites buyers to look at its packaging
Shares in the Swiss packaging company SIG were boosted by more than ten per cent on Monday after the company said it would open its books to potential suitors.
The company’s move follows rejection of a SFr2.28 billion ($1.85 billion) takeover bid from Norway’s Elopak company and CVC Capital Partners.
At the stock exchange in Zurich SIG shares closed the day at SFr345.50, a 13.19 per cent increase over Friday’s close.
A statement from SIG headquarters just outside Schaffhausen said the board of directors had decided that the weekend takeover offer was “inadequate and too low”.
It added that in order to allow shareholders to decide on an optimal solution for SIG, “other interested parties” should now be given an opportunity to evaluate acquisition of the company.
The board is to establish the ground rules within the next few days under which potential buyers might undertake a due diligence review (audit of the accounts).
Elopak, through its parent company Ferd, and CVC Capital Partners had made a public tender of SFr325 per share but said this could rise to SFr350 if SIG granted them an audit review.
Analysts have described the Ferd/CVC offer as “fair” and “correct”.
TetraPak challenge
The deal would have created the world’s second-largest player in food and drink packaging and lead to a stronger challenge to Sweden’s TetraPak.
SIG, which made a name in Switzerland for its railway wagons and the rifles it supplied to the Swiss army, has long been the focus of takeover activity.
Company shareholders in March defied rebel shareholder Sterling Investment Group which had sought to oust the chairman and open SIG’s books for suitors.
Big shareholders in SIG include Swiss investor Tito Tettamanti, the United States private investment firm Tweedy, Browne Co., the Susquehanna Financial Group, Britain’s Cheyne Capital Management and the Zurich Cantonal Bank.
After two years in the red, SIG made a profit of SFr73.2 million in 2005 after a loss of SFr258.8 million in 2004.
swissinfo with agencies
SIG was founded on January 17, 1853.
The first SIG railway wagons received awards at the World Exhibition in Paris.
In 1863, SIG was awarded a major contract for infantry rifles to equip the Swiss army.
The last large-scale military contract for SIG was the model 90 Swiss assault rifle.
The strategy of concentrating on packaging was defined in 2000 but SIG was no stranger to the sector.
It had been involved in packaging for almost a century before. SIG packaging activities started with Toblerone chocolate.
Its current range of products includes the manufacture of cartons for beverages and food products, as well as machinery for the filling of packages.
In the PET sector, it also makes equipment for the production, coating and filling of plastic bottles.
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