KEY POINTS:
A Takeovers Panel order that Kerifresh shares found to be held in breach of the Takeovers Code must be auctioned off is a "complete joke", says Turners & Growers chairman Tony Gibbs.
His fruit and produce exporting company suspended a takeover offer for Kerifresh in October after the
Takeovers Panel found non-compliance with the code by Kerifresh managing director Alan Thompson, director Hamish McHardy, McHardy-controlled firm Sundry Investments, former director Graham Cowley and his company Iron Hills Vineyards, and Emma Jane Eastwood and her company Anbran Trustee Company.
The Takeovers Panel found the parties had broken rules under which a person and their associates are not allowed to own or control more than 20 per cent of a company's stock without making a takeover bid or getting shareholder approval.
On Monday, the panel said the shares that had breached the code - about 23 per cent of total voting rights - must be transferred to an independent broker for sale by auction using an open book process. Proceeds from the auction would be remitted back to the Thompsons and McHardys after the deduction of the broker's costs and expenses.
"I think this decision is a complete joke," Gibbs said. "It completely means that people can hold the code in contempt and it sets a precedent which they're going to find very difficult to live with in the future."
Last month, Turners & Growers filed proceedings in the High Court against shareholders in Kerifresh for costs and forfeiture of shares.
The court action was already lodged and would take its course, Gibbs said.
"I think what's very disappointing in this is that the Takeovers Panel [is] basically saying you can breach the code, you can be very naughty, you can be found guilty and then we'll just make you sell your shares and then we'll give you the proceeds back," he said.
"So if there ever was a wet bus ticket they've found it."
Turners & Growers had not yet decided whether they would bid for any of the shares.
The Takeovers Panel said people who were found to have breached the code may bid for shares but must give notice within a few days that they intended to make a full takeover offer.
"The panel notes that, in giving these undertakings, Hamish and Jonathan McHardy, and Alan and Helen Thompson, stated that they do not accept the correctness of the panel's findings against them," the panel said.
Kerifresh could not be contacted after the Takeovers Panel statement was released on Christmas Eve.