EMCO fails to persuade Commission

Press, 2 May 1985, Page 28

EMCO fails to persuade Commission

PA Wellington The Commerce Commission is satisfied statements made by Brierley Investments in its application for the EMCO Group would have made no difference to the granting of consent to the proposal to buy shares in the company. In a statement last night, the Commission said EMCO’s concern was that Brierley had stated in the application that “the acceptability of an offer and price would have plenty of time for public discussion.” Similarly, that the directors of Emco would have an opportunity in the correct manner to make their reply and comments to shareholders.

A dispute had arisen between Emco and Brierley as to whether this statement was in fact misleading. The Commission did not investigate or comment upon this matter.

However, it was satisfied, on reviewing the application, that the statement

made no difference to the procedure adopted (including the confidentiality order) or the grant of consent to the proposal for the purchase of shares in EMCO.

In the Commission’s opinion, the proposal was not contrary to the public interest and there was no significant foreclosure of competition as the Brierley interests were in different markets from those of EMCO. The Commission chairman, Mr John Collinge, said the Commission’s role was to determine public interest matters and it was not its role to become involved in the tactics of the takeover battle or the private decision of shareholders as to the disposal of their shares. The Commission would take action in circumstances where it considered any statements made to it were deceptive and would have materially affected its decision. The Commission met the

chairman and managingdirector of EMCO, Messrs Lyn Papps, and R. N. Mason, on Tuesday and received submissions from a Brierley representative, Mr Bruce Hancox.

Mr Collinge said the first concern expressed to the commission by EMCO was the job security of staff after completion of the takeover.

The commission said that it had received an assurance from Brierley in its application that “there would be no loss of job opportunities.” In subsequent conversations with Mr Hancox, the Commission had received a further assurance that there would be no foreseeable redundancies. The Commission assured Emco that, if any breaches of' these assurances were reported, they would be investigated and, in appropriate circumstances, would be acted upon by the Commission.