Court rejects Lion's extra time bid

By DITA DE BONI

Lion Nathan's attempt to gain more time to sell 19 per cent of Montana has been scuppered.

Yesterday, Lion presented an affidavit to the High Court asking that the date by which it must sell its defaulting shares in Montana be extended from August 17 to at least August 23.

The court denied the request.

Lion argued that its High Court challenge to the findings of the market surveillance panel's standing committee - which has been set for Friday - does not leave enough time, if it is unsuccessful, to sell down the offending shares.

If the Lion challenge fails, and if the brewer cannot sell the shares by the August 17 deadline, the shares will revert to Montana's board to dispose of, which will effectively allow Allied Domecq a crack at the coveted 19 per cent.

Lion has already received one extension to its original 30-day time-frame - from August 11 to August 17 - and Allied Domecq has also extended its $4.80 a share bid for control of the company until August 24.

The brewer estimates it has lost around $30 million by having to abort its two-tiered offer in late July, at a stage when buyers had been arranged for the holding.

But lawyers for Allied and Montana argued that Lion was "not entitled to any indulgence" from the court, suggesting that the brewer was at fault for not starting the sell-down process in a timely fashion.

Allied lawyer Julian Miles, QC, said that Allied had suffered "prejudice" as Lion had wanted to "cut it out of the loop" in its arrangement of buyers for the 19 per cent shareholding and, in any case, had drawn up a timetable for selling the shares that was excessively long.

Justice Rodney Hansen said it was "inappropriate and unnecessary" to grant Lion's request and referred the matter and the parties to the substantive case, which will be heard on Friday.