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Special enticement for ABDAB shareholders

Associated Bahamian Distillers and Brewers Ltd.(ABDAB)shareholders concerned that Trans-Island Traders’plans to acquire AML Foods(AML)would be detrimental to their interests if implemented, will be offered a special enticement to garner their support for the deal.

In an exclusive interview withGuardian Businesson Friday, Mark Finlayson, who is president of both Trans-Island Traders and ABDAB, said that he must satisfy ABDAB shareholders before any formal tender offer and proposal are made to AML shareholders. ABDAB’s next board and annual general meetings are scheduled for February 24, 2011, at which time ABDAB will receive the proposal to acquire Trans-Island.

“The thing about it is, our ABDAB shareholders have been very, very good–in the good times and the bad times–and going forward now we need to make sure to give them the opportunity to participate in what we believe is going to be a very good business,”Finlayson said.

If the AML acquisition plans were not on the drawing board, ABDAB could expect to see Trans-Island Traders, owners of City Market’s parent company Bahamas Supermarkets Limited(BSL), utilize three of its properties as the sites for planned 55,000-square-foot City Market Super Centres. Two of those locations–one on the East-West Highway and the other on Queen’s Highway in Freeport–are in close proximity to AML stores. If the AML acquisition succeeds those two locations would not be necessary, so ABDAB shareholders would only see a property on JFK Drive at the former Burns House location occupied by a City Market Super Centre.

Finlayson said he could not disclose any estimates on the value of Trans-Island Traders.”That has to be formulated and provided to the directors first,”he said. He added that Trans-Island was prepared to be flexible in order to ensure that ABDAB shareholders would participate in any benefits the proposed AML acquisition would bring, if successful. Finlayson revealed that he has already been in discussions with some ABDAB shareholders who were also directors, and according to him”they support it strongly.”

For the shareholders of AML Foods, this will mean that they will not have any formal tender offer from Trans-Island Traders before February 22, although Finlayson said,”hopefully by the end of the month”the formal proposal should be presented.

Some news reports suggested that there was a deadline of Friday, February 11 for the formal tender and proposal from Trans-Island, but according to Finlayson this was not the case.

“There was never a deadline,”he said, adding that the company also had made no commitments to that effect.

A press release from the Securities Commission of The Bahamas(SCB), released on Friday, addressed the process for takeover bids, the general guidance on the structure a prospectus would need to take, the filing of requirements, and the general best practices that should be observed by both the acquiring and the target companies. The responsibilities of both to protect and keep fully inform the minority shareholders were also communicated in the release.

“The Commission wishes to assure the public that it is doing all it can within its authority to work closely with both parties associated with this offering, to ensure equitable and fair dealings,”read the release.

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