Company

Takeover provisions - compulsory purchase of minority shareholding - offer documentation not sent into Australia - compulsory purchase notice subsequently sent to Australian shareholder - notice validIn re Joseph Holt plc: Winpar Holdings Ltd v Joseph Holt Group plc: ChD (Anthony Mann QC): 27 October 2000

The defendant, in the course of a takeover bid, sent out offer documentation to all the shareholders in Joseph Holt plc except those in Australia, Canada, Japan and the USA, since compliance with the securities regulations in those countries was too difficult and costly.

The defendant obtained over 90% of the shareholding in Joseph Holt and therefore sent out notices to acquire the remaining shares under the compulsory purchase mechanism of s.429(1) Companies Act 1985, including a notice to the claimant, an Australian company which had a minority shareholding in the company.

The claimant made an application to the court for declaration that the s.429(1) notice was invalid since their shares were not shares to which the offer related according to the terms of s.429(1) because the offer documentation had not been sent to them.

Stuart Adair (instructed by S J Berwin & Co) for the claimant; Philip Gillyon (instructed by Addleshaw Booth & Co, Manchester) for the respondent.

Held, dismissing the application, that the shares owned by the claimant were shares included in the takeover offer even though the offer documentation had not been sent to the claimant; that the defendant had put itself in a position in which, by making a sufficiently widely distributed and notified offer anyone with the relevant shares could provide them with an acceptance; that the mechanism of the offer meant that it was not easily conveyed into Australia but there was nothing to prevent an Australian resident from travelling outside Australia to accept the offer; thus the s.429 notice was valid.