Comvita chairman Neil Craig is expecting Cerebos' takeover bid for the manuka honey products company to lapse as the Singapore owned company fails to budge on its offer.

In October it offered $2.50 per share with a purchasing window open until December 22, but the market price on the NZX has shown Comvita shares have remained above this.

It is trading today at about $2.75 per share.

An independent advisor's valuation of the company gave a per share valuation of $3.40 to $4.

Today Cerebos confirmed it was not raising its offer.

'Comvita directors are not surprised by this development as we believed from the outset Cerebos made an opportunistic bid to take over the company at a significant discount to its true value,” says Neil.

'As we have stated on several occasions, we believe the offer price undervalues Comvita by a considerable margin.

'Further, the independent adviser's valuation range of $3.40 to $4 does not fully reflect our view of the potential and therefore the value of Comvita.

'Our current growth strategy is built on product innovation, an enhanced supply chain and control of channels to market.

'This strategy is starting to deliver significant and increasing returns to shareholders of Comvita.

'Our market guidance for the year ended 31 March 2012 remains at sales of $91 million to $95 million (FY 2011: $82 million) and normalised NPAT of $7.3m to $8.2m (FY 2011: $3.6m), and we expect revenues and earnings to continue to grow in 2013 and beyond.

'Cerebos' offer price equates to a price-to-earnings multiple (PE) of just 9.6 times the midpoint of forecast 2012 earnings of 26 cents per share.

'The mid-point of the independent advisor valuation range of $3.40 to $4 per share equates to a PE multiple of approximately 14 times, slightly below the average PE multiple of the New Zealand market of approximately 15 for the current financial year. 'Comvita is a considerably better than average company.

'The takeover offer has been an unwanted distraction.

'It has, however, assisted in providing greater awareness of Comvita and its value-add growth strategy.

'Comvita's board and management remain focused in building a highly profitable and competitively sustainable global natural health and beauty business, proudly New Zealand owned and operated.”