Minority shareholder activist and Guardian Holdings Ltd (GHL) shareholder, Peter Permell is commending "the hard-working men and women of the TTSEC for their role in ensuring the recent disclosures by Jamaica’s NCB Financial Group (NCBFG)”.
These disclosures included the fact that the US$2.35 per share take-over bid launched via its wholly-owned subsidiary NCB Global Holdings Ltd (NCBGH), on December 8, 2017, to acquire GHL, is as a direct result of certain amendments in November 2017 to the original May 2016 lock-up agreement that secured the initial acquisition of the Lok Jack and Ahamad families 29.99 per cent stake in GHL for the previously undisclosed sum of US$3.24 per share.
He said “the important take away for GHL shareholders from these damning revelations is that subject to the Securities Industry (Take-Over) By-Laws, 2005, By-Law 13, it is illegal for NCBFG or any Offeror who makes or intends to make (as evidenced by the May 2016 Agreement) a take-over bid to enter into the any collateral agreement, commitment or understanding (as again evidenced by the May 2016 Agreement) with the Lok Jack and Ahamad families in their capacity as the beneficial owners of shares of GHL (the Offeree Issuer) that has the effect of providing to the Lok Jack and Ahamad families with a consideration of greater value (ie, US$3.24) than that offered to the other minority shareholders of GHL (ie, US$2.35).”
Permell said he was advised that By-Law 24 is very instructive in understanding the role and responsibility of the TTSEC in this regard as it states “(1) If the Commission considers that a person has not complied or is not complying with these By-Laws, the Commission may make an order:
(a) restraining the distribution of any record used or issued in connection with a take-over bid or issuer bid; (b) requiring an amendment to or variation of any record used or issued in connection with a take-over bid or issuer bid and requiring the distribution of any amended, varied or corrected record; and (c) directing the person to comply with these By-Laws or restraining that person from contravening these By-Laws and directing the directors and senior officers of such person to cause him to comply with or to cease contravening these By-Laws.”
He explained that “On January 5, we met with the TTSEC and subsequently filed a formal complaint on January 9. On January 12, the foregoing revelations were published by NCBFG in the media along with an extension of the Closing Date to February 2, 2018. On January 22, we again wrote to the TTSEC calling for an immediate halt to this illegal take-over bid pending the completion of their investigation. An approach that we are advised is not only standard protocol but moreover the prudent and responsible thing to do in the circumstances. Unfortunately, to date, we have not had the courtesy of an acknowledgement.”
Permell said that in the circumstances, the TTSEC must act now. He said given the closing date on Friday, if they do not hear from the TTSEC by tomorrow, "we will have no choice but to instruct our attorneys to commence the necessary legal proceedings to secure our interest as GHL minority shareholders in this matter".
THE OFFER
On December 8, 2017, NCBFG launched through its wholly-owned subsidiary, NCB Global Holdings Limited, an offer and take-over bid to all shareholders of Guardian Holdings Limited (GHL), to acquire up to 74,230,750 ordinary shares in GHL for US$2.35 per GHL Share. Full acceptance of the Offer would result in a cash payment by NCBFG of the sum of up to approximately US$174,442,262.00 to the shareholders of GHL who accept the Offer. The Offer, if successful, would result in NCBFG acquiring a controlling interest in GHL. The original close date of the Offer was January 12, 2018, which was subsequently extended to February 2, 2018 in order to allow shareholders to assess additional disclosure information shared in an amended Offer Circular.