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20 May 2003
The Panel is seeking urgent submissions on a proposed class exemption for shareholders of Richmond Limited.
In Richmond Limited v PPCS Limited the High Court made orders forfeiting and suspending certain voting rights in Richmond held by PPCS Limited. As a result of this, the other Richmond shareholders who currently hold or control less than 20% of the voting rights, could become holders or controllers of more than 20% when the Court orders take effect. This would put these shareholders in breach of the Code.
This will come about only if the current orders are confirmed by the Court of Appeal later this year.
The Panel considers it is appropriate to exempt Richmond shareholders from rule 6(1) of the Code in respect of any increases in their percentage control of voting rights in Richmond that result directly from the forfeiture or suspension of voting rights held by PPCS.
The exemption would enable any shareholder to purchase up to 20% of the current voting rights in Richmond before the Court orders take effect. The shareholder would not have to sell down, and could vote, any shares that represent more than 20% of the voting rights in Richmond immediately after the Court orders took effect. However normal Code rules would apply to any subsequent transactions.
Before making a final decision the Panel seeks comment from interested parties on its intention to grant such an exemption and on a draft exemption notice.
Submissions must be received by 9 a.m. Monday 26 May 2003 and may be sent to the Takeovers Panel, by post, fax or email for the attention of Marion Hemphill (email@example.com).
The memorandum to Richmond and its shareholders and a draft exemption notice are available on the Panel's website (www.takeovers.govt.nz).