Millennium & Copthorne Independent Directors Push Back Against Takeover Bid

Highlights:

• Independent Directors Reject Low Bid: Millennium & Copthorne Hotels New Zealand Limited (NZX: MCK) independent directors argue that City Developments Limited's (SGX: C09) takeover offer undervalues the company.
• NZSA Raises Minority Shareholder Concerns: The New Zealand Shareholders’ Association (NZSA) warns that the takeover process may not adequately protect minority investors.
• Takeover Offer Under Scrutiny: City Developments aims to acquire the remaining 24.1% of shares, but shareholder advocacy groups are calling for a fairer valuation.

Bid Price Deemed Too Low by Independent Directors

Millennium & Copthorne Hotels New Zealand Limited (NZX: MCK) has seen its independent directors challenge the takeover offer from its majority shareholder, City Developments Limited (SGX: C09), stating that the bid price undervalues the company. At the time of writing, shareholder advocacy groups have also raised concerns about the fairness of the offer for minority stakeholders.

NZSA Raises Minority Shareholder Concerns

The New Zealand Shareholders’ Association (NZSA) has voiced apprehension over the takeover process, emphasizing the importance of protecting minority shareholders. NZSA Managing Director Oliver Mander highlighted that without adequate safeguards, minority investors might not receive fair value for their shares.

Takeover Offer Details

Singapore-based City Developments, which already holds a controlling stake in Millennium & Copthorne, initially launched a bid in January to acquire the remaining 24.1% of shares it does not own. While the offer reflects a premium over previous trading prices, independent directors argue that it does not fully capture the company's long-term value and future growth prospects.

Shareholder Advocacy Calls for Fair Valuation

The pushback from independent directors and shareholder groups underscores a broader discussion on corporate governance and fair valuation in takeover deals. Investors are now closely watching how the process unfolds, as regulatory approvals and shareholder responses will play a crucial role in determining the outcome.

With the debate over valuation ongoing, all eyes remain on how Millennium & Copthorne's independent directors and minority shareholders will respond to the takeover bid in the coming weeks.

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