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Olam to take over Queensland Cotton

08
Mar '07
Olam International Limited (Olam) today announced an off-market takeover offer to acquire all shares in Queensland Cotton Holdings Limited.

Under the offer, Queensland Cotton shareholders will receive AU$4.75 cash per share (First Tier Price). If Olam obtains acceptances in respect of 90 percent Queensland Cotton shares and is entitled to compulsorily acquire the outstanding shares, it will increase its offer by a further 30 cents to total AU$5.05 cash per share (Second Tier Price).

The First Tier Price values Queensland Cotton's equity at AU$134 million and represents a premium of 42 percent to the closing price of Queensland Cotton shares on ASX on March 6, 2007 of AU$3.35, 43 percent to the one month volume weighted average price (VWAP) of Queensland Cotton shares on ASX prior to this announcement of AU$3.33, 41 percent to the six month VWAP of Queensland Cotton shares on ASX prior to this announcement of AU$3.37 and 31 percent to the 12 month VWAP of Queensland Cotton shares on ASX prior to this announcement of AU$3.62.

The Second Tier Price values Queensland Cotton's equity at AU$142 million and represents a premium of 52 percent to the one month VWAP and 39 percent to the 12 month VWAP of Queensland Cotton shares.

The First Tier Price and the Second Tier Price exceed the net tangible assets of Queensland Cotton as at August 31, 2006 of AU$4.66 per share. Queensland Cotton shares last traded in this range (between AU$4.75, the first tier price and AU$5.05, the second tier price) on ASX in May 2005.

The First Tier Price and the Second Tier Price imply trailing Price Earnings Ratios of 10.2 times and 10.9 times respectively, based on Queensland Cotton's earnings of AU$13.05 million for the year ended February 2006.

Olam International Limited


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