Report values AAPT shares above bid

Cable & Wireless Optus has significantly undervalued AAPT in its $5 per share takeover bid, according to an independent report by Grant Samuel & Associates.

In the report commissioned by AAPT, Grant Samuel has valued AAPT in the range of $6.04 to $7.01 per share, 20.8 per cent to 40.2 per cent above Cable & Wireless Optus' (CWO) offer.

According to officials, Grant Samuel's valuation is on the conservative side, but clearly vindicates the view of AAPT directors that CWO's offer undervalues the carrier.

Following the release of the report, Lee Casey, AAPT chairman said yesterday the directors of AAPT will urge shareholders to reject the offer.

"The directors of AAPT intend to formally recommend shareholders reject CWO's offer," he said.

"The directors cannot recommend an offer that clearly does not recognise the inherent value of AAPT shares . . . Until we get a [higher] bid . . .we would certainly say $5 is ridiculous."

Whilst not willing to speculate on how much higher the valuation could go, Larry Williams, CEO of AAPT and Casey agreed the range could have been wider, with the lower end of the scale being higher.

"The general feeling is [that it is] on the low side," Casey said. "The top end reflects more the future of value of the company."

In their report, Grant Samuel said the valuation range of AAPT shares reflected an expectation of substantial growth in revenues and earnings from infrastructure investments, changes in the telecommunications environment as well as growth in Internet usage and data traffic.

According to AAPT officials, the Grant Samuel report will be issued to shareholders with AAPT's Part B document, sometime after C&W Optus has released its Part A document.

In other news, the Supreme Court has voted in favour of C&W Optus in the court hearing regarding amendments to the Part A.

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