Raphael Geminder is following through on his stated intention to delist Pact Group in light of his failed takeover of the company, and has set 16 July as the date he wants it off the ASX.
The company will hold an EGM on 12 June for shareholders to vote on the proposal. However, it won’t be plain sailing for Geminder, with some minority shareholders set to vote against the motion, and at least one reportedly writing to the ASX to ask it to ban Geminder’s entities from voting, saying the move would disadvantage minority shareholders.
Geminder, whose net worth is estimated at $1.58bn, launched a $234m bid to increase his 50 per cent stake in Pact Group to total control 18 months ago. But, despite extending and upping the bid 13 times, has failed to get his bid across the necessary 90 per cent shareholding line, reaching 87.9 per cent. During the latter stages of the bidding process he made it clear to minority shareholders that he would look to delist if the bid failed.
If the company is delisted, the minority shareholders will then have their options to sell their shares significantly curtailed. Pact shares are currently trading at 92c, about 10 per cent higher than the final offer bid by Geminder made a year ago.
The Pact board said the reasons for the delist proposal are low liquidity in the stock, the low level of trading, and the costs of maintaining an ASX listing, as well as the burden of compliance for an ASX listing, and the amount of time the board has to use for ASX matters.
The ASX has given advice that it will agree to Pact Group’s removal from the ASX, subject to its usual conditions. Pact has said minority shareholders will be able to sell their shares on the ASX prior to 16 July should they choose to do so.
If Pact has more than 100 shareholders when it has delisted it will have to give continuous disclosure to ASIC, and lodge annual and half yearly results with ASIC, if it has less than 100 shareholders then those obligations no longer apply.
