Shareholders agree to privatise Bridgestone

By From news| Mar 21 2007
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SHAREHOLDERS of tyre producer Bridgestone Australia Ltd today voted to privatise the company, after more than 50 years as a public entity.

Shareholders meeting in Adelaide agreed to a $50 million buyback of the company's minority shareholdings.

The company will become a wholly-owned subsidiary of major shareholder Bridgestone Corporation of Japan.

Minority shareholders hold about 14.5 million shares of Bridgestone Australia, while Bridgestone Corp has more than 22 million shares, or 60.3 per cent.

Bridgestone Corp is offering $3.40 a share, which comprises a return of capital of 50 cents and a fully franked dividend of $2.90.

Bridgestone Australia chairman and chief executive Mac Ohashi said the privatisation would give Bridgestone Australia more flexibility to run the business in an increasingly competitive market.

"This is a critical step for the future growth of the business," he said.

Bridgestone Australia will be delisted from the Australian stock exchange on May 30.

The company announced its intention to privatise last December.

Bridgestone Australia executive director of finance, Andrew Moffat said today that the privatisation of the company would not affect its daily operations.

"The employees and customers won't notice any difference," he said.

"The difference really is in the corporate governance/reporting side in that we will no longer be a public, listed company.

"So disclosure of our trading results will not occur."

Mr Moffat said Bridgestone Australia was the only part of Bridgestone operations around the world that was publicly listed.

He said some minority shareholders in the past had been critical of the company for not distributing franking credits.

"This was a way to return value to those minority shareholders," he said.

Bridgestone Australia shares were three cents higher at $4.32 at 1.17pm AEDT today.

Mr Moffat said the $3.90 offer had higher value depending upon the individual shareholder's tax circumstances.

Bridgestone Australia said in January that there were few benefits of being listed.

Its shares were relatively illiquid given that most were held by Bridgestone Corp and the stock lacked representation in key stock market indices.

One of the benefits of being listed was that it could raise capital efficiently, but the company had no expectations of raising capital in the short to medium term.



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