Tower becomes the hunter
Tower has made a conditional cash offer for FAI Life.
Wednesday, March 3rd 1999, 12:00AM
Tower Corporation has, today, moved from being the hunted to the hunter. It has announced a cash takeover bid of FAI Life in Australia.Its conditional offer of A$1.50 a share values FAI at A$195 million and is a premium of 9.5 per cent on the march 2 closing price of FAI's shares.
Tower managing director James Boonzaier says the bid is "fair" and he is confident it will be accepted.
If successful Tower Life Australia and FAI Life will be merged into one entity and it will substantially improve Tower's market position in Australia.
The combined group will be about a third bigger than Tower Life is currently and the combined premium income of the enlarged entity will be A$704 million. In total Tower Financial Services Group will have assets under management of A$11.3 billion of which A$6 billion will be in Australia.
"(The bid) is very much in keeping with our strategic policy of achieving growth through a combination of aggressive market penetration and acquisition," he says.
"The acquisition of FAI Life will provide a quantum leap in the market presence of Tower in Australia which might otherwise have taken several years to achieve," he says.
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