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LABATT DISMISSES BID; LOOKING TO A-B AS WHITE KNIGHT?
Published May 22, 1995
The battle for John Labatt Ltd. "heated up" over the weekend as President George Taylor accused Onex Corp. of trying to "steal" his brewing business with a low offer. On Thursday, Onex Corp. offered C$2.3B in an unsolicted bid for Labatt, which also owns the Blue Jays, Argonaunts, TSN, and a percentage of SkyDome. In a statement released on Friday, Taylor claimed that Labatt is "in discussion with several parties" interested in acquiring all or part of the comppany. Taylor: "We are confident that alternate arrangements will emerge that will more accurately reflect the true value of the company's assets for all shareholders." The market is "expecting a higher bid, judging from the heavy trading in Labatt shares," according to Marina Strauss in the Toronto GLOBE & MAIL. Among possible suitors: Anheuser-Busch and CanWest Global Communications (Toronto GLOBE & MAIL, 5/20). A-B declined comment amid rumors "it was acting as a white knight suitor" for Labatt. Labatt is A-B's Canadian partner and brews and distributes Budweiser In Canada, but a deal "would present some complications" as A-B already owns an MLB team, the Cardinals (AD AGE ONLINE, 5/22). Labatt shareholders "seem delighted by the hostile takover bid" by Onex, according to Larry Greenberg in this morning's WALL STREET JOURNAL. Michael Palmer, an analyst at Equity Research in Toronto: "The management has no support from shareholders. The company is gone." Greenberg adds Miller to A-B as possibly interested in a bid for Labatt (WALL STREET JOURNAL, 5/22). BUSINESS WEEK examines Labatt's woes: "Did Labatt Guzzle Too Much Too Fast" (William Symonds, BUSINESS WEEK, 5/29 issue).