Golden Circle says rejects Coca-Cola Amatil offer

MELBOURNE, Oct 5 (Reuters) - Australian food and beverages firm Golden Circle said it had rejected a takeover offer from Coca-Cola Amatil Ltd (CCL.AX) because it was too low, in favour of a private equity offer.

Coca-Cola Amatil said last week it was in talks with unlisted Golden Circle, in a deal worth about A$195 million ($173 million).

Golden Circle is owned by around 850 shareholders, mainly pineapple farmers, who supply more than 180,000 tonnes of fruit and vegetables each year for processing. It is best known for producing canned pineapple, juices and fruit salads.

"Coca-Cola's proposal for 100 percent of the company at A$1 (per share) offer price was highly conditional and we did not believe it was superior," said Golden Circle Chairman Ern Pope, adding it was Coca-Cola Amatil's second offer.

He said the board of Golden Circle had decided to stick with its recommendation of an earlier offer from private equity firm Anchorage Capital Partners, financially backed by Macquarie Bank MBL.AX.

Pope said Coca-Cola Amatil's offer undervalued the upside potential of the company.

Under the Anchorage recapitalisation, shareholders will retain ownership of 65 percent of the company, with the possibility of floating Golden Circle on the Australian Stock Exchange after two years.

Anchorage will pay A$35.5 million for 44.3 million Golden Circle shares, or 35 percent of the firm, at a price of 80 cents per share, and about A$120 million of debt will be refinanced.

Golden Circle shareholders are due to vote on the Anchorage offer at a meeting on Oct. 29.

A spokesman for Coca-Cola Amatil, which is 30 percent owned by The Coca-Cola Co (KO.N), was not immediately available for comment.

Coca-Cola Amatil was keen on Golden Circle to combine with its SPC Ardmona fruit processing business, as part of its long-running push to diversify out of fizzy drinks. It bought Ardmona in 2005 for A$500 million. ($1=A$1.13)