Wraps and broker valuations - Southcorp Panel decision

The Takeovers Panel has considered in detail for the first time the use of a 'wrap' document and given greater focus to the use of broker valuations by bidders.

The key aspects of the Panel's recent decision regarding Foster's bid for Southcorp relate to:

• a 10-page wrap that Foster's proposed to bind with the bidder's statement to be sent to Southcorp shareholders but did not lodge with ASIC with its bidder's statement; and

• Foster's use in the wrap of an average value for Southcorp shares derived from the numerical average of the nine most recent stockbroker reports on the value of Southcorp shares before Foster's announced that it had acquired an 18.8per cent interest in Southcorp.