Costa board set to sign Paine Schwartz’s lowered bid

Costa is a large Australian grower of berries, mushrooms, citrus fruit, tomatoes and avocados. It operates 7200 hectares of farmland in Australia, but also has facilities in Morocco and China.

Now, Costa Group’s board, chaired by Neil Chatfield, is expected to give its blessing to New York private equity investor Paine Schwartz Partners’ revised $3.20-a-share bid, after nearly four months of negotiations. It is understood the two camps were on track to sign an agreed deal at $3.20 a share, valuing Costa at $1.4 billion. Documentation was expected to be signed on Thursday evening or Friday morning at the latest. It would pave the way for the scheme vote that Paine Schwartz will require to take Costa off the ASX boards.

Costa told shareholders on Monday that Paine Schwartz, which specialises in agribusiness and food chain buyouts, had signalled that the new bid, down from $3.50 in May, was the highest it would make. “[Paine Schwartz] has also indicated that this offer is the best and final price at which the PSP-led consortium can deliver the proposed transaction,” the company said.


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