87m pounds hostile bid for funeral business
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Your support makes all the difference.GREAT Southern, the family-controlled funeral business, yesterday received a hostile pounds 87.4m takeover bid from Service Corporation International of the US.
Success for SCI depends on a separate and as yet unspecified bid for JD Field, a private company that owns 56.1 per cent of Southern.
Field has 15 shareholders, including Edward Field, president of Southern.
Southern said it would examine the offer and urged shareholders to take no action.
William Heiligbrodt, president of SCI, which is valued on Wall Street at dollars 2.2bn ( pounds 1.5bn), said: 'I've come here to buy. I didn't come unprepared.' He said his aggressive move followed unsuccessful talks last week.
'I am surprised and disappointed that our offer has not been taken seriously by the board and Southern's major shareholder.'
SCI is also thought to have mounted a stock market raid on Southern's shares yesterday.
'You wouldn't expect me to do this and not buy stock,' Mr Heiligbrodt said.
Southern's shares soared 138p to 608p, against the 600p cash offer from SCI. More than 500,000 ordinary were traded, equal to 4.3 per cent of the total in issue.
The ordinary offer is worth pounds 69.5m, and the remaining pounds 18m represents a 239p bid for Southern's 6.9 million convertible preference shares, up 73p to 243p.
Holders of the preference shares only gained the opportunity to convert into ordinary stock at the start of this month. Assuming full conversion, the preference shares would amount to 18 per cent of the enlarged ordinary capital.
More than 820,000 were traded yesterday - 12 per cent of the total in issue. Southern's directors control more than 11 per cent of the preference shares. SCI is bidding for a UK base of 150 funeral parlours, 12 crematoria and two cemeteries.
Southern also runs Chosen Heritage, a pay-now-die-later scheme. Chosen has pounds 40m funds held in trust on 67,000 pre-arranged funerals.
SCI is thelargest quoted funeral company in the US. It owns 843 funeral parlours and 201 cemeteries in 40 states, the District of Columbia, four Canadian provinces and five Australian states.
Southern made pounds 4.1m of taxable profits on turnover of pounds 32.7m in 1993, against respective figures for SCI of dollars 101m ( pounds 69m) and dollars 900m.
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