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9/9/2003



Rail News: Rail Industry Trends

Tranz Rail's board backs Toll Group's latest takeover bid


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On Sept. 5, Tranz Rail Holding Ltd.'s board recommended that shareholders accept Toll Group Ltd.'s new takeover offer of $1.10 per ordinary share — a 15-cent increase from the firm's previous bid.

The new offer exceeds Tranz Rail's estimated value (as of late July) and board members have been unable to obtain a competing offer, Tranz Rail officials said in a prepared statement. Board members who hold Tranz Rail shares expect to accept Toll's bid.

"Directors had worked hard to encourage a superior offer [and] this is a good outcome for all concerned," said Tranz Rail Chairman Wayne Walden.

On July 31, Tranz Rail's board recommend that shareholders reject Toll's 95-cent-per-share offer because it was lower than the current market price.

Under Toll's offer, the Australian logistics and transportation provider would operate New Zealand's 2,400-mile multi-modal freight transportation company, and the New Zealand government would regain ownership of Tranz Rail's track.

New Zealand would establish Crown corporation TrackCo to maintain and control the track; TrackCo would charge Toll for track use.


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