New Richmond takeover bid expected

By LIAM DANN

Richmond chairman Sam Robinson has sent a reminder to shareholders that they should expect a new takeover from PPCS if there are no challenges following last week's Appeal Court decision.

The ruling overturned an earlier High Court decision and gave southern meat company PPCS a 62.94 per cent shareholding in Richmond.

In the letter Robinson notes that at the Court of Appeal, PPCS' counsel handed the court a written undertaking that if the voting rights on its 35.75 per cent stake were restored, it would make a new takeover offer for the remaining shares in Richmond at its previous offer price ($3.11 a share).

Richmond shares closed at $3.15 yesterday.

The undertaking was conditional on there being no appeal to the Privy Council.

"The independent committee believes that PPCS is bound by its undertaking to the court," the letter states.



PPCS chief operating officer Keith Cooper acknowledged his company had an obligation to reopen the offer if there there was no appeal by the deadline of October 21.

"Clearly we've given an undertaking and in the event that a whole series of things happens, that would follow," he said.

One group of Richmond shareholders is "actively considering" a Privy Council appeal to stop PPCS getting control.

The group's leader, Napier lawyer Robin Bell, said cost was not a barrier to taking the legal battle further.

"We're quite capable of going it alone," he said. "The cost is not a concern, the principle is far more important than cost."

The Bell Group - which is understood to have a stake of about 10 per cent in Richmond - was one of the two parties that had actions dismissed by the Appeal Court.

The other was Richmond itself.

Richmond is also looking at its options but there is believed to be little enthusiasm for further action.

Bell said he would be interested in Richmond's decision but it would not affect his plans.

"To a degree we'll be proceeding independently from Richmond."

Whether an appeal would prejudice shareholders looking to benefit from a new takeover offer was one of the factors that would be considered, Bell said.

Getting a decision from the Privy Council could take up to two years but most of that time would be spent waiting.

A senior commercial lawyer, who asked not to be named, said a Privy Council challenge was not as expensive as most people thought.

It was likely to cost the Bell Group between $100,000 and $200,000, he said.

The group's chances of succeeding are likely to be the determining factor in making a decision.

Bell was on holiday overseas last week.

He has only just had a chance to read the judgment.

He was not prepared to comment on the specifics of the ruling but said it had come as a disappointment.

The group would look to make a decision before October 21, he said.

The Government is planning to discontinue New Zealand's link to the Privy Council in London.

But Bell said he understood any action taken in the PPCS/Richmond case would be outside the time frames set by the Government.