Resimac ups RHG bid

The takeover battle for Resimac has taken a new twist with a sweetened bid for Resimac

Resimac Ltd has again sweetened its takeover bid for RHG Ltd, formerly RAMS Mortgage Corp, in an attempt to stymie a rival bid put by Pepper Australia and the target's largest shareholder last week. 

The Resimac-led syndicate has increased its all-cash offer to 49.5 cents per share, from 48 cents - which was already an increase of 3.9 cents per share over its original offer. 

The move came after spurned suitor Pepper Australia joined forces with Cadence Capital, the largest shareholder of RHG, to put an increased offer of 49.65 cents a share, in cash and Cadence scrip.

RHG said its board was mulling the competing offers - which have both been been made under schemes of arrangement. 

However, Resimac's latest offer had seen RHG enter an amended merger implementation deed with the syndicate.  

The syndicate, which included the Australian Mortgage Acquisition Company, said it was open to working with Cadence to restructure part of the offer. 

RHG today also disputed a requirement under the Pepper offer that it pay a fully-franked dividend of about 2 cents by October 31, saying it could not pay without going into a franking deficit.  

The extra dividend would cut the amount Pepper would pay for RHG. 

Resimac said its offer was superior given it was all-cash, and allowed RHG to pay a fully-franked dividend within limits of its available franking credits. 
Pepper's offer included 35 per cents share in cash and one fully-paid Cadence (CDM) share for every 10 ordinary RHG shares held, based on yesterdya's closing price of $1.465 for Cadence units. 

CDM would also pay RHG investors a fully-franked dividend of 5 cents for each of its shares received under the scheme. 

Existing CDM shareholders will receive the full year dividend of 5 cents per share previously announced by CDM.

The syndicate said it was prepared to work with CDM to restructure its offer, to allow shareholders who had a preference for Cadence shares to get them "on a purely optional basis provided this is able to be accommodated without regulatory difficulties and without delay"