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Comvita takeover bid set to expire

A takeover offer for Comvita by Cerebos New Zealand is set to lapse next week.

A takeover offer for Comvita by Cerebos New Zealand is set to lapse next week.

Neil CraigCerebos New Zealand, a subsidiary of Singapore-listed Cerebos Pacific, offered $2.50 per share – but Comvita fought back, citing an independent report assessing it as being worth $3.40 to $4.00 per share.

Comvita chairman Neil Craig said the company had come under intense scrunity as a result, but stood by the belief that the offer undervalued it by a "very considerable margin".

"The offer has further engendered a resolute enthusiasm from staff for Comvita as a business with an outstanding future," he wrote in a letter to shareholders – with many "previously ‘silent’ investors showing their support for Comvita both verbally and, in some cases, by buying shares on market".

He said Comvita's prospects were strong, especially in Asia.

"We are well positioned in the fastest growing markets of Asia, where sales have grown from $7.4 million in 2006 to an expected $33 million this financial year. We have over 100 employees in Hong Kong, which is our hub for Asia."

The company is confident it will meet its projections of sales for the year to March 2012 of $91 million to $95 million and a normalised net profit after tax of $7.3 million to $8.2 million.

It is estimated that two-thirds of manuka honey sold from New Zealand is via Comvita.