Montana offer to be scrutinised on Thursday

By DITA DE BONI

The Montana Standing Committee will hear arguments on Thursday about the latest legal stoush for control of the winemaker.

Yesterday, the Market Surveillance Panel said just two members of the three-member committee - Bill Wilson, QC, and retired Court of Appeal judge Sir Duncan McMullin - would reconvene to consider whether Lion Nathan's latest two-tier offer complied with both NZ Stock Exchange listing rules and the committee's June 29 decision, which found that Lion had illegally bought shares in Montana Group.



The committee's ruling requires Lion to sell 19 per cent of Montana by July 27, cutting the brewer's stake from 62 per cent to 43 per cent.

Last Monday, Lion made a fresh offer to buy 11 per cent of Montana for $5.50 and the rest for $3.70.

Allied Domecq, Lion's rival for control of Montana, alleges this offer breaks the rules because, by offering to buy shares while going through an enforced selldown, Lion is effectively making a deal with those to whom it sells its defaulting securities.

The committee ruled that Lion must sell the shares "provided it does not do so pursuant to any form of contract, arrangement or understanding in place at the time of transfer."