Zeder ups Kaap Agri offer

Cape Town - Zeder Investments, the PSG-controlled agribusiness investor, has bumped up its offer to minority shareholders in former cooperative Kaap Agri by 10c per share to 635c/share.

A notice published on Tuesday did not detail why Zeder's offer had been increased, but it said Kaap Agri shareholders that had already accepted the offer would automatically receive a settlement of 635c/share.

Zeder CEO Antonie Jacobs told Fin24.com that there were a couple of "biggish blocks" of Kaap Agri shares available at 635c. "We wanted to make sure we cross the 35% (shareholding) hurdle".

Jacobs, however, said he was not at this stage allowed to disclose how many shares Zeder had picked up since making the offer to Kaap Agri minorities.

Before the offer, Zeder held a 34.3% stake in Kaap Agri which has been a stout profit performer of late.

In the half-year to end-March 2009, Kaap Agri ? which earns the bulk of its keep from its Agrimark retail outlets - generated revenue of R1.35bn.

Net profits for that period came in at R171m (70c/share), bolstered by a major slab of earnings derived from Kaap Agri's stake in food giant Pioneer Foods.

It seems Kaap Agri will comfortably surpass the 103c/share earned in the year to end-September 2009. This means Zeder might be buying Kaap Agri shares on a forward earnings multiple of around five times.

- Fin24.com