GPG found no conspiracy: lawyer

By PAUL PANCKHURST

Guinness Peat Group started its legal proceedings against Perry Corporation with a lot of huffing and puffing about "some sort of conspiracy" - but never found one, said Alan Galbraith, QC.

He was making closing submissions yesterday for Perry, a multibillion-dollar US hedge fund, in the High Court at Auckland.

Justice Judith Potter reserved her decision.

GPG alleges that Perry hid a 16 per cent shareholding in forestry and biotech company Rubicon through equity swaps with two merchant banks, UBS Warburg and Deutsche, in June last year.

The corporate raider says Perry breached securities laws that require disclosure of stakes bigger than 5 per cent.

Yesterday, however, Galbraith told the court that it was "clear beyond any argument" that there were no side deals between Perry and the two merchant banks.

For Rubicon, another defendant in the case, Jim Farmer, QC, said the company did not believe Perry had held a disclosable interest - for reasons including oral advice from Rubicon's lawyers.

For GPG, Raynor Asher, QC, said the fact was that when Perry needed to convert its "economic interest" into "direct ownership" to vote the Rubicon shares, "it was able to do exactly that".

It got back the same number of shares - minus a partial "unwind" - that it had transferred to Deutsche and UBS Warburg a year earlier.

The court had heard "the best possible evidence" - transcripts of telephone conversations - of an understanding between the parties that this would happen.

GPG was not suggesting "a conspiracy" but "an understanding", he said.

All the evidence "points to the inescapable conclusion that such an understanding existed".

During the case, GPG said that when it lifted its stake in Rubicon to 19.9 per cent in a lightning raid in July, it had no idea that Perry had a 16 per cent stake in the company.

Perry said it had an "economic interest" of that size but did not own that quantity of shares.

GPG wants a forfeiture and/or sale - at arm's length - of shares by Perry to reduce its holding to the level that it had publicly disclosed, 4.895 per cent.