Authorities must fast track rules to stop 'low-ball' share offers - Stiassny
Vector chairman Michael Stiassny is appalled that Bernard Whimp is engaging in further trickery with another "low-ball" offer to Vector shareholders which would result in a significant financial loss to them if they accepted.
Mr Stiassny was referring to another unsolicited offer to Vector shareholders by NZ Investment Securities LP, a company associated with Mr Whimp (who was banned as a company director for four years in October 2006).
"Mr Whimp is offering Vector shareholders $3.20 per share, which is above current market price, but the amount is only payable in instalments over a ten year period and all future dividends are foregone from the time the offer is accepted," Mr Stiassny said.
"There is no certainty that the instalments would be paid and shareholders should be aware they would become unsecured creditors in the event Mr Whimp fails to meet his payment obligations.
"This is blatant trickery and is targeting investors who may not read the 10 year payment period in the fine print or understand that they would be handing their dividends over to NZ Investment Securities LP," he said.
The Vector Board does not endorse the unsolicited offer and is advising shareholders to be wary.
Mr Stiassny urged the regulatory authorities to intervene and fast track a proposed change in legislation that would offer shareholders better protection from "low-ball" unsolicited offers.
"Changes to legislation are needed urgently- this is the second "low-ball" offer Vector shareholders have received from Mr Whimp in the last four months. It is imperative that robust legislative changes are made quickly to protect shareholders," he said.
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Comments and questions19
What a load of Crap ! why do we need more legislation ? if any shareholder gets an offer and they dont seek advise before selling to a so called "low ball" offer they deserve what they get. For god sake Michael do you want to wipe their bums as well ?
Agree Snook , surely Michael will get more fees for more advise , i'snt he good at that ?
typical nz knocking machine - sure he's just trying to protect people and put some confidence back in the market. iw ould have thought that should be encourage. Good on you Michael
Regency Court comes to mind, here.
Are you referring to, when he was the BNZ liquidator, and he gave Hotchin that "amazing knock-down deal" when the developer went bust?
A simple rule change stopped this type of thing dead in Australia. the Ministry of Economic Development did not think it was necessary in NZ because there was no evidence of this type of thing happening. Well it is, so they need to get this fixed. Agree regulation for the sake of regulation is not good, but this is in part about protecting what little reputation the NZ market has left.
Well done Vector fot a clear statement. I'd call this a curve ball, because the offer is well above market price, and the scam that the amount is only payable over 10 years is only on the reverse of the form, and not mentioned on the acceptance form at all.
We've received a similar offer from Carlyle Securities LP for Contact Energy shares
Well dont you listen , always read the fine print before signing anything. Its the number one rule ! yet so many just dont.
How can you call it a scam ? its nothing of the sort, isnt it a delayed settlement ,often done in the normal course of business should you accept ! and that the key , if you dont like the terms don't accept it .
To those of you who support Whimp I will offer you double the current market price for all your shares on the same payment and dividend terms as Whimp
Put your money were your mouth is. are you WGA ?
He is doing it to Fletcher shareholders as well under the guise of 'Fairfield Securities LP'
Preying I will bet on selected people from the share register - holders of a few(comparatively) shares for a long period of time. ie likely to be elderly and not au fait with the sharemarket.
The ten year thing is there plain as day but no doubt the 'general' partner(the one who has unlimited liability) in this 'limited partnership' is a shell company with no money.
If they get half of their money I will be astounded.
And those of you defending the behaviour of these predators - would you like it if I approached an elderly relative offering over the odds prices on their house over a ten year period?
In the right circumstances these share deals could even have a taxable element to the seller under the accruals rules.
Always check with your company before parting with your shares...better late than sorry!
Well done Michael and Tom for you sound comments.Tthe same can not be said for Snook who should be Nuked.
When does a reasonable offer become unreasonable? What is the threshold? How do we protect & identify those who are unable to manage their affairs? Whimp disgusts us all but Its a free market and he has the right to make an offer no matter how ludicrous. My confidence in the market will be restored if there are no acceptances of his offer, unfortunately its unlikely to happen.
Willing buyer willing seller, Michael knows how business works - he doesn't work for free- profit is a measure of a businesses's health-there is never a win win in a transaction- one party is always worse off
why doesn't someone get in fast and offer the cash hungry shareholders a fair price making a fair profit in the process.. Once the cash hungry have sold the problem is over.
"one party is always worse off"
The share market is not zero-sum