It looks take over action is heating up . Heer is what was pubklished by Stockwatch. Can anybody comment on possible price if Bradstone Equity wants to buy the company ? (they already own 18% of the shares)
===========================================
Peruvian Gold Limited -
What, me confident?
Peruvian Gold Limited PVO
Shares issued 14227466 1998-01-08 close $0.88
Thursday Jan 8 1998
Also Bradstone Equity Partners Inc (BEP.A)
ATKINSON RECKONS HE'S THE WINNER
by Stockwatch Business Reporter
Bradstone Equity Partners' takeover bid for Peruvian Gold (the bid nobody wants to call a bid) still is in the diplomatic stage, that is: perhaps they can pull it off without firing a shot.
Bradstone's Robert Atkinson, who earlier was mum on the subject, has opened up just a smidgen. He says he generally does not talk to the media. "I'm too old for that," heaves the former Chairman of the Vancouver Stock Exchange.
The one-time president of institutional broker, Loewen Ondaatje & McCutcheon, says "a bunch of institutions" called him and said, "Will you help us out?" Mr Atkinson, who is also known as "Ackie" on Howe Street, says the stock fell from $5 following the Bre-X scandal and the drop in the price of bullion. "So I simply went out and bought a block of (Peruvian) stock, 17 or 18 percent; the institutions called me and said 'You're in Vancouver, can you ensure that this guy doesn't waste our money?'"
"This guy" refers to Peruvian's parsimonious president David Henstridge, who quickly organized a poison-pill measure in mid-December, a few weeks after Bradstone announced it had bought another half-million shares to take its position to nearly two million shares, or 13.8 percent of the company. Bradstone now owns around 18 percent, still well short of 20 percent -- the point at which regulators insist parties declare their intentions and make a general offer for the company.
Mr Atkinson says if Mr Henstridge thinks he will ever be able to apply his poison pill, he should think again. "That has to be approved by the shareholders and it won't be, I'll tell you right now," Mr Atkinson insists, adding Mr Henstridge does not have the support of brokers that have a lot of say over the company. Mr Atkinson notes that Goepel Shields & Partners has sold Bradstone blocks of shares. "Isn't that interesting?" he posits confidently.
At issue is Peruvian's doggy share price, which on January 8 closed at $0.88, even on the day but down $0.06 from the day previous, and well off its glory-day heights of $7 in May 1996.
What makes Peruvian so attractive for a takeover bid, however, is its strong cash reserves of $12.5 million (of December 11) which, at 14.2 million shares issued means PVO is barking at or below its breakup value.
Mr Atkinson, a disarmingly charming fellow even on a bad day, said he met with Mr Henstridge late last year and told him he had a large stake in Peruvian "and I suppose some influence with institutional shareholders." He emphasized he was not leading a takeover bid. "David Henstridge was very nice but he went to his lawyers and started to put the poison pill in place."
Mr Atkinson says he does not blame Mr Henstridge for wanting to protect his turf. "All of a sudden he sees his company, he owns three percent, and he's not going to control it for very much longer," the Vancouver-based financier says. "I told him, 'David, I have no interest in cutting you out. I simply want to have some involvement in how you spend your $13 million in cash.' I said you can have everything you've got now; the trouble is, you're not going to take the $13 million and drill holes in Asia, for example, or Peru, because your results have not been very good."
The Bradstone chief says he was contacted by Canaccord Capital's principals after the 13.8 percent stake was made. "They wanted to know what I was up to," he recalls. "I told them the same thing I'm telling you: there are some disgruntled shareholders, and shareholders have the right to get rid of incompetent management. Now I'm not suggesting Henstridge is incompetent. But he is incompetent the way he's reacting because what he's trying to do is get my anger up. He takes a shot at Bradstone. What has Bradstone done? He says, 'With $25- or $45-million (in Mr Atkinson's war chest), I'm dead meat. I might as well start throwing arrows.' Do I blame him? Not at all, but I don't know why he doesn't take the high road."
Mr Henstridge earlier told Stockwatch that Bradstone's track record of taking over companies left much to be desired: "The evidence suggests he's not going to be friendly at the end of the day," the Peruvian president said in December. He later backed off that statement, saying he has no opinion on Mr Atkinson and that Bradstone was simply another shareholder on his registry.
Mr Atkinson defends Bradstone's track record. During the last year, the Alberta-listed company took significant positions in two cash-rich juniors -- Harbour Petroleum (HRP.T), and Spur Ventures (SVU.V). After Bradstone became involved, both companies retained their management, he claims, adding he is helping management put into place long-term plans that will enhance shareholder value. Other companies have benefited from Mr Atkinson's financial acumen include Trimin Enterprises (TRM.T) and Kingsway Financial Services (FKS.T), the latter of which Mr Atkinson says was at $5 when he bought five percent two years ago, but which closed on January 8 at $27. "It's hugely profitable and if this is destroying companies, I'd like to know about it," he contends.
Asked which institutions approached him regarding Peruvian, Mr Atkinson declined to name names. However, the engaging Howe Streeter says he has contacted all with stakes in Peruvian "and not one of them is happy. In fact, they're really distressed." Among the most distressed are two unnamed Bermudan-based insitutions, he adds.
Of those that are distressed and disgruntled, perhaps the most distressed and disgruntled would be those that took out a three-million-share private placement in September 1996 at $4.50. Among these were the TD Bank (800,000), Dynamic Precious Metals Fund (600,000), BPI Canadian Small Companies Fund (450,000); and 32 others. Other private placees in Peruvian, who might want some action, include a cadre of swinging broker-promoters from First Marathon Securities. This money-loving group, which helped promote Walter Nash's Cartaway Resources to $25 on hot air, may not have far to go to find a helpful ear at Peruvian. Mr Henstridge's co-director is Walter Nash.
"I don't know the institutions that well," Mr Atkinson states. "But we do have access to the brokerage community and we know how to raise capital. If you look at the scavenger's list of the VSE by Canaccord and there's any company that is near cash-breakup value, we have an interest in it because cash is going to be king in the next six months," Mr Atkinson says.
"We buy companies and the bottom line is the only vulnerable management are the ones that aren't doing very well," he adds. "And when you have a company and you let the share price trade at less than the cash in your treasury, somebody is not very happy and there are people who will take advantage of it, and I'm one of them."
(c) Copyright 1997 Canjex Publishing Ltd. canada-stockwatch.com
old url (better for printing) |
