Found this on the web today::
By Pavel Alpeyev
Nov. 18 (Bloomberg) -- Orbis Funds, the asset manager that opposed takeover offers by Warren Buffett and Citigroup Inc., rejected Canon Inc.’s 730 million euro ($1.1 billion) bid to buy unprofitable Dutch printer maker Oce NV as too low.
Canon’s 8.60 euros-a-share offer “significantly undervalues” Oce’s assets, and Orbis doesn’t want to sell its stake of about 10 percent at that price, the Bermuda-based manager of $20 billion in assets said in a statement today. Canon said its bid was sufficient and Oce declined to comment.
The opposition pits Canon, the world’s largest maker of office equipment, against a fund that challenged Buffett’s bid for Clayton Homes Inc. in 2003 and led investors in pressuring Citigroup to raise its offer for Nikko Cordial Corp. two years ago. Canon earlier this week said it agreed to buy Venlo, Netherlands-based Oce to expand its printer operations.
“Opposition by such a major shareholder could result in delays and negative consequences for the deal,” Osamu Hirose, an analyst at Tokai Tokyo Securities who rates Canon shares “neutral,” said by phone today. “With Oce’s recent earnings in a slump, it might be tough to find a bidder who will offer a better premium.”
Oce’s review process of the bid was “careful and complete,” the company said in a statement today. Oce has had “frequent contact with all relevant industry players” and discussed various possible transactions before deciding on Canon.
Counter Bid?
Konica Minolta Holdings Inc., the Japanese lens and office- equipment maker that has a business partnership with Oce, said yesterday it has no plan to counter Canon’s offer.
Canon fell 0.3 percent to 3,460 yen on the Tokyo Stock Exchange. Oce added 0.3 percent, to 8.60 euros in Amsterdam trading. It surged 70 percent on Nov. 16 after Canon announced its offer.
“We believe that our offer, as was agreed by Oce’s management and supervisory boards, is sufficient,” Canon said in an e-mailed statement today.
Ducatus NV, ASR Nederland NV and ING Groep NV, which represent about 19 percent of Oce’s share capital, have agreed to sell their stakes to Canon, Oce said Nov. 16. Bestinver Gestion SA, holder of about 9.5 percent of the outstanding stock, provided an irrevocable undertaking to tender.
The Japanese company, also the world’s largest camera maker, has bought shares representing 16.9 percent of Oce’s total issued share capital, Tokyo-based Canon said yesterday. Canon wants a minimum acceptance of 85 percent, it said Nov. 16.
Wide-Format Printing
The offer values Oce’s stock at about 16 percent higher than its projected book value for the year ending November, according to the average of six analyst estimates compiled by Bloomberg. That’s in line with projected multiples at office equipment makers such as Xerox Corp. and Brother Industries Ltd.
Oce will become a separate division within Canon with a worldwide responsibility for wide-format printing, commercial printing and business services, Oce Chief Executive Officer Rokus van Iperen said on a Nov. 16 conference call with reporters. The transaction value amounts to about 1.5 billion euros including debt and other obligations, he said.
The deal is Canon’s biggest purchase, giving it control of the world’s largest maker of machines that make blueprints for construction companies and advertising posters. Ricoh Co., Japan’s second-biggest maker of office equipment, last year agreed to buy Malvern, Pennsylvania-based Ikon Office Solutions Inc. for $1.62 billion to expand operations in the U.S.
Citigroup
In 2007, Orbis led investors in Japanese brokerage Nikko Cordial to press Citigroup to raise a $13.4 billion bid by offering to sell their shares at a higher price than the U.S. bank was paying.
Berkshire Hathaway Inc., controlled by billionaire investor Buffett, was opposed by a group of Clayton investors including Orbis in 2003 over its bid for mobile-home maker Clayton. Orbis’s group said then Buffett’s fund was taking advantage of a drop in mobile-homes sales to buy the company cheaply. The deal was completed after the Tennessee Supreme Court refused to hear an appeal by one of the investors.
Last month, Oce reported its third-quarter net loss widened to 25.7 million euros, from 24.2 million euros a year earlier. Revenue dropped 9.9 percent to 630.8 million euros.
To contact the reporter on this story: Pavel Alpeyev in Tokyo at