GRD bid offers an exit for Stokes

GRD, which is 12.2 per cent owned by Seven, said its directors would advise shareholders to accept AMEC's cash offer of 55c a share.

The deal values Seven's stake

at $12.9 million; it spent $56.7 million on the shares more than two years ago.

GRD's chief executive, Cliff Lawrenson, told the Herald the company had canvassed the opinion of key stakeholders including Seven and Investors Mutual, which together own close to a quarter of the stock, before endorsing the bid, in the absence of a better offer.

In August 2007 it rejected a conditional offer from Transfield Services for up to $2.75 a share. Key stakeholders, including Seven, reportedly did not want to sell at that price, which could have given Mr Stokes a quick $8 million windfall profit.

Investors will vote on AMEC's takeover, to be implemented via a scheme of arrangement, by early October. It is expected the local management will continue to run the business.

The deal, which was foreshadowed last month, comes after Mr Stokes spent about $260 million on a hostile share raid on James Packer's Consolidated Media Holdings this month. ConsMedia holds valuable stakes in Foxtel, Fox Sports and the job site Seek.

Although a relatively small investment, departing GRD now would be "good for sentiment", showing that Seven was focused on media, Andrew Anagnostellis from Deutsche Bank said.

Seven paid $2.35 a share for its first 20 million GRD shares in May 2007, topping it up with another 3.5 million shares at $2.77 shortly after, prompting analysts to lash out at Mr Stokes's unpredictable investment strategy.

Seven argued at the time that GRD met its "objective of seeking investments which add value and have good growth prospects".It has since written down about $50 million of the investment.

A spokesman would not comment yesterday on whether it would offload its stake now.

GRD shares closed 3.5c higher at 53c, indicating the market is not expecting a better deal.