Lion meeting approves bid

Press, 9 March 1988, Page 39

Lion meeting approves bid

PA Wellington 1 Lion Corporation share--holders yesterday approved the proposed merger between the company and retailer, L. D. Nathan and Company at an extraordinary meeting in Auck) Lind. j Of the 1468 f olders who voted at yesterday’s meeting, 1413 voted in favour, repre) seating 71.4 per cent of the votes cast, said Lion’s chairman, Sir Gordon Tait, in a statement after the meeting. “These figures are ah overwhelming, confirfnalion of the position taken by the board of Lion,” he said. Excluding the Malayan Breweries interests, shareholders representing ess than 1 per cent oif Lion’s total shares voted hgainst the merger. i | A bid by Malayan Breweries to stop thp merger was ruled out of order at the meeting. I A lawyer for Malayan Breweries said the notice convening the meetirig was invalid. ' ‘ The notice was “extraordinarily deficient” because it gave shareholders too little information on the business to be transacted. I

A memo which shareholders were sent on February 29 went too late fbr them to consider thejir vote, said Malayan Breweries representative, Mr Nick Davidson.

However, Sir Gordon said Malayan Breweries and its associates had gone to considerable lengths to frustrate the merger with two High Court injunctions,, and cases before the Securities commission, the Minister of Justice (ls4r Palmer), and the Stock Exchange. ‘

“The proceedings were the cause of the delay in sending out a Lion profile to shareholders,” he said. Sir Gordon ruled the attempt to invalidate the meeting out of order. The shareholder approval given yesterday includes the purchase, of Fay, Richwhite’s stake at a premium. But some shareholders suggested the price being paid for Fay Richwhite’s strategic holding was: too great. Sir Gordon responded by saying if jFay Richwhite did not get its 920 c deal the merger would not go ahead and the holding could be sold to unfriendly parties, i In that case, Sir Gordon said, “the future for Lion is probably quite dreary.” The most likely buyers of Fay Richwhite’s Nathan holding, were the merger not to succeed, was the Coles Myer supermarket chain in Australia. A successful merger would see the Malayan interest in Lion reduced from about 22 per cent to 11 per cent. The merger has been opposed by Malayan Breweries which represents a 22 per cent shareholding held by Heineken, NV, and the Singapore beverage firm, Fraser and Neave. I

Malayan Breweries took unsuccessful legal action when the merger was announced in January and prompted a Securities Commission inquiry' into aspects of the merger.

But the Securities j Commission found no iregularities in the purchase of Fay, Richwhite’s 35 per cent stake in L. D. Nathan, and the (Commerce Commission approved the merger on Monday.