Horizon Energy has expressed its frustration at an expensive takeover dispute with Marlborough Lines.Marlborough will take the Takeovers Panel and Horizon Energy to the High Court today to try and overturn costs awarded against it after a failed 51%
Horizon Energy has expressed its frustration at an expensive takeover dispute with Marlborough Lines.
Marlborough will take the Takeovers Panel and Horizon Energy to the High Court today to try and overturn costs awarded against it after a failed 51% takeover bid in September 2009.
The bid was blocked by 77.3% shareholder Eastern Bay Energy Trust, which has indicated it would like to move to 100% ownership to ensure local control.
In an address to shareholders released Friday to NZX, Horizon Energy chairman Rob Tait estimated the costs of the takeover offer and subsequent disputes to Horizon at over $800,000.
He expressed his frustration at ongoing costs and erosion of management time as a result of the dispute.
"The entire matter would have been avoided if prior to launching their takeover bid, someone at Marlborough had simply telephoned the Trust and asked if the Trust would sell any Horizon shares," he said.
“By any measure, the Marlborough takeover offer was ill-conceived. What sense is there in seeking to acquire 51% of a company controlled by a 77% shareholder without a simple telephone call to the major shareholder and seeking support for the offer?”
Marlborough Lines chairman David Dew told NBR that he had met with Trust chairman Kevin Henessy prior to the takeover offer and had left with the impression that it would not be opposed.
“To be fair to him, he didn’t indicate a position for the Trust – but if the Trust didn’t want to receive that, they should have said no, don’t do that.”
Neither party, according to Mr Dew, has initiated mediation proceedings in relation to the takeover dispute.
UPDATE - Mr Henessy has issued a release that there was "no attempt at confirmation of support from the trust" prior to the takeover bid and that Mr Dew's assertion of some degree of support is "quite wrong".
Rare opportunity
Meanwhile, Marlborough continues with its bid to increase its Horizon holding to 15%, on Friday announcing an increase of 269,824 shares from 12.5% to 13.58%.
The company successfully completed a $10m move to 10.1% in June.
Mr Dew said on Friday that Horizon represented a rare opportunity to enter or increase stake in the electricity distribution market. Marlborough already owns a half share in Nelson Electricity and 51 percent of OtagoNet.
Horizon Energy made an audited net profit after tax of $5.9m for the year ended March 31, and supplies around 24,000 customers.
