Low-ball Vector share victims get second chance

Vector chairman Michael Stiassny. Photo / Paul Estcourt

Vector shareholders who sold into a 'low-ball' share offer sent out over the summer holiday break have been told they can back out of the deal on a technicality.

Company chairman Michael Stiassny said this morning that more than 170 shareholders now have the opportunity to review their decision to sell their shares due to incorrect or incomplete information submitted on the share transfer forms.

Stiassny has contacted the affected shareholders - more than half of the number that accepted the offer - advising that without the required information, including a correct shareholder number and authorisation, Vector and the Computershare registry had not been able to confirm that the shares should be transferred.

Stiassny said that the company 'valued its shareholders' and cautioned against accepting any unsolicited share offer without first seeking professional advice

Controversial share buyer Bernard Whimp made close to $300,000 through the offer made to Vector shareholders by his limited partnership Energy Securities.

Companies associated with Whimp, a former Christchurch property developer who is now registered to a Sydney address, sent letters to shareholders in seven large listed companies between Christmas and New Year.

Vector, Telecom, Fletcher Building and TrustPower investors were among those targeted with offers to purchase shares at a discount of up to 43 per cent on the market price.

Vector said 373,209 shares, or 0.15 per cent of their shares that are available for trading, had been sold to Whimp's company.

Energy Securities had offered $1.56 per share - 34 per cent less than the $2.36 they were trading at on the market on December 29. The difference in the offer price and the listed price could have netted Energy Securities $298,567.

Stiassny said last month he was concerned shareholders had unwittingly sold their shares at a rate below market value.

"These shareholders did not receive a fair price for their shares and that absolutely galls me," he said.

While it was up to individuals to make their own investment decisions Stiassny said the board was concerned at the style in which the share offer was made.

The Securities Commission has previously said unsolicited offers to buy shares below market value are not illegal, but it is against the law to mislead or deceive investors into accepting an offer.

Whimp, who has previously used limited partnerships to get around a four-year ban on holding directorships that ended in October, is able to get hold of shareholders' details through a public register.

It's not the first time Whimp has made money from his offers.

In August, he made offers for four million DNZ Property Fund shares, and bought 2.2 million at 60c each.

Shares in DNZ have since traded at between 99c and $1.25, so Whimp would have made at least $858,000.

He has also been linked to below-par offers to investors in South Canterbury Finance and Strategic Finance.

- HERALD ONLINE