Coopers can sue sell-out investor

Discussion of Lion Nathan's failed takeover bid for the independent Cooper's Brewery and links to articles and other discussions.

Coopers can sue sell-out investor

Postby Oliver » Saturday Oct 22, 2005 9:40 am

The article below is from ... 62,00.html

I was also interested to read this in a stock market report on

Lion Nathan, whose takeover bid for Coopers Brewery is seen as doomed, was down 17c to 839.


Coopers can sue sell-out investor
Blair Speedy

COOPERS Brewery has been granted leave to take legal action against a shareholder who tried to sell stock to hostile takeover suitor Lion Nathan.

In a Federal Court hearing in Melbourne yesterday, Justice Alan Goldberg agreed to allow Coopers to make a cross-claim against Barry Schrapel, who transferred 500 shares into a holding company set up by Lion, with Mr Schrapel as beneficiary.

As trustee and owner of the holding company, Lion plans to argue that it is in legal terms a relative of Mr Schrapel and should therefore have the same right as Coopers' 117 other shareholders to purchase any shares that come up for sale.

But Coopers has refused to transfer the shares, arguing that it is a ruse designed to circumvent the company's constitution, which specifies that shares that come up for sale must first be offered to shareholders and their family members, then Coopers' staff superannuation fund, then Lion Nathan.

Dick Whitington QC, appearing for Coopers in Adelaide by video-link, said the trustee company was an "alter ego" of Mr Schrapel and Coopers should be able to cross-claim against him.

Mr Schrapel has also brought a claim of oppression against Coopers, alleging that directors conducted the brewer's affairs with the aim of concentrating its ownership in their own hands, contrary to the interests of Coopers shareholders.

Mr Schrapel's legal costs are being met by Lion Nathan.

Noting the increasing complexity of the case, one of four in the courts between Coopers and Lion, Justice Goldberg said: "I think we've got everything in this except a will case. I'd like to keep it that way."

The full bench of the Supreme Court of South Australia will today hand down a decision on Lion's appeal against an earlier ruling that allowed Coopers shareholders to vote on a resolution to remove Lion's pre-emptive rights.

If the decision is upheld, Coopers would be able to apply for leave to convene an extraordinary general meeting to vote on the removal of Lion's rights.

The meeting, originally scheduled to be held tomorrow, was postponed on the order of Justice Goldberg because Coopers shareholders hadn't been told that voting in favour of the resolution would effectively kill off Lion's takeover bid.

Coopers is working on a target statement of reasons for rejecting Lion's $260 a share offer, which values the brewing company at $352 million.

Lion has adopted a scatter-gun approach in its pursuit of Coopers thorough the courts, funding some shareholder actions and promoting others.

The company was last week circulated a letter from a shareholder in listed investment company Argo, complaining that the vehicle could have made an extra $2.15 million by selling its Coopers shares to Lion rather than a 2003 buyback.
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Postby Dogger Dan » Saturday Oct 22, 2005 11:26 am

Mess with the Bull and you get the horns

"Listening to someone who brews their own beer is like listening to a religous fanatic talk about the day he saw the light" Ross Murray, Montreal Gazette
Dogger Dan
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Joined: Thursday Aug 26, 2004 10:43 am
Location: Lucan, Ontario, Canada

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