The Panel has received an application from Mr Gordon Elkington in relation to the affairs of Wollongong Coal Limited. The application concerns an independent expert’s report provided in the context of a compulsory acquisition under Chapter 6A commenced by the major shareholder of Wollongong.
Details of the application, as submitted by the applicant, are below.
A sitting Panel has not been appointed at this stage and no decision has been made whether to conduct proceedings. The Panel makes no comment on the merits of the application.
Wollongong is an unlisted public company.
On or about 6 July 2021, Wollongong undertook a rights issue to eligible shareholders of 56 new shares for each existing share held at an issue price of $0.0001 per share.
On 29 September 2021, Jindal Steel & Power (Mauritius) Limited, the major shareholder of Wollongong, increased its shareholding in Wollongong from 61% to 98.62% as result of its participation in the rights issue.
On 17 December 2021, Jindal sent a compulsory acquisition notice to the other Wollongong shareholders advising that it proposed to acquire their shares at $0.0001 per share, which was accompanied by an independent expert’s report. The independent expert’s report opined that the value of the Wollongong shares was nil, and that the proposed consideration therefore gave fair value for the shares.
The applicant submits (in summary) that the independent expert’s report, in arriving at its opinion that the Wollongong shares have nil value, does not take into account the consideration paid by Jindal in subscribing for its full entitlement under the rights issue, thereby breaching section 667C(2).
The applicant seeks a final order that another independent expert’s report be prepared and that the timetable for the compulsory acquisition be adjusted accordingly.
Chief Executive, Takeovers Panel
Level 16, 530 Collins Street
Melbourne VIC 3000
Ph: +61 3 9655 3500