Bills to Help Heileman Brewing Thwart Takeover Advance in Wisconsin

The Wisconsin Assembly on Wednesday passed two anti-takeover measures designed to thwart a $1.01-billion bid by Australia’s Bond Corp. Holdings Ltd.’s for G. Heileman Brewing Co., a La Crosse, Wis.-based brewer that is the nation’s fourth largest.

The two measures were later debated in the state Senate, where approval was expected late Wednesday, according to Senate majority leader Joseph Strohl.

One bill, adopted by an 84-to-8 vote, would permit only a company’s current board to sell assets to finance a buyout. A new board made up of members of the acquiring group could not authorize an asset sale to help defray the cost of an acquisition.

The second bill, approved on a voice vote, strengthens the rights of companies to adopt “poison pill” bylaws to counter takeover attempts.

If passed by the Senate, both bills would then go to Gov. Tommy G. Thompson, who has said he will sign them into law.

Perth-based Bond, which already owns the Pittsburgh Brewing Co. as well as Australia’s Swan and Castlemaine Fourex beer brands, said it would challenge the measures in court. Peter Mitchell, executive director of Bond Corp. Holdings Ltd., said his firm would argue that the measures are unfair restrictions of trade.

Executives of Bond have been lobbying hard in legislative corridors against the measures, Strohl said. Other lawmakers said Mitchell told them repeatedly that Bond has no intention of moving Heileman out of Wisconsin if it takes control of the brewer.

Legislative leaders indicated that they intended to get both measures to the governor’s desk for signature by today, when Heileman’s board planned to meet and act on the $38-a-share tender offer by Bond Corp. Holdings.

Thompson called the lawmakers into special session Tuesday, saying the legislation was necessary to help protect Wisconsin corporations from hostile takeovers.

“We have to debate and act on a very short period of time with a limited amount of knowledge,” said Assembly Speaker Thomas Loftus. “I suggest we do it and get out of town.”

Loftus said the legislation would protect “one of Wisconsin’s best corporate citizens.”

The Assembly Economic Development Committee endorsed the two bills Tuesday evening and sent them to the floor of the lower house.

“We’re concerned about our company,” Heileman Chairman Russell G. Cleary told lawmakers Tuesday. “We’re concerned about our employees. We’re concerned about our plants and our communities.”

But Bond’s Mitchell said the measures were “fueled by fear” that Chairman Alan Bond might sell or shift Heileman’s operations if he acquired control.

“I don’t think this can be characterized as a hostile takeover . . . by a T. Boone Pickens or someone of his ilk,” Mitchell said, referring to the well-known corporate raider during the joint hearing by economic development committees of the Assembly and Senate.

“We’re brewers,” Mitchell said. “We think we’re good brewers.” He added that he believed that the bills were intended to protect Heileman’s board, not its shareholders. On Sept. 4, Bond offered $38 a share, or $1.01 billion, for Heileman. The tender offer expires Oct. 2.

Wisconsin lawmakers are the latest this year to pass anti-takeover legislation in response to a real or perceived threat to state industries. North Carolina, Minnesota and Washington in recent months have swiftly approved legislation intended to thwart actual or threatened takeover bids.

Cleary told lawmakers that securities law restrictions prevented him from saying too much about the Bond bid and declined to comment on whether he considered it a hostile offer.

After Tuesday night’s endorsement, some committee members expressed concern about the haste with which the proposals were being advanced.

Rep. Shirley Krug of Milwaukee said that if the Heileman board decided on Friday to accept Bond’s offer, “they will have made dupes out of this Legislature.”