PPCS puts on feisty front over censure

By PHILIPPA STEVENSON

Southern meat company PPCS is keeping up a typically pugnacious front over its shareholding in rival Richmond.

PPCS said last night that it had lodged an appeal against last week's High Court judgment ordering it to forfeit $10 million of shares in Richmond, and make a successful bid for 90 per cent of the company or lose any influence altogether.

The company said the appeal meant the forfeiture of shares and cost penalties in favour of Richmond would not apply until the appeal process was ended.



In last Friday's judgment, Justice William Young said he expected PPCS to appeal "if only for the reason it would wish to preserve its rights to challenge this decision in the event that it is unable to achieve a complete takeover of Richmond."

And in a letter to the co-operative's shareholders this week, PPCS chairman Jim Pringle indicated the company was not about to abandon its five-year battle for control of Richmond.

"The process of investing in Richmond has been protracted and costly. However, your directors maintain the investment is strategically correct for our future."

Pringle indicated PPCS was uncowed by the judge describing it as having erected a "facade of untruths" to perpetrate "gross commercial misconduct".

He told shareholders the company was reviewing the judgment "on the basis of incorrect application of the penalty provisions of the Securities Amendment Act 1988".

He said that it was inconceivable the company could be penalised over shares the court ruled had been bought in compliance with statutory regulations.

In his ruling, Justice Young said he was satisfied he had jurisdiction to address the shares held by PPCS because its breaches of the substantial security holder regime over a 35 per cent holding held in 2000 had avoided the probability of a forfeiture order being made then.

PPCS used an undisclosed nominee, HKM, to buy those shares.

The judge said PPCS' position in Richmond would undoubtedly be different if the misconduct had been detected in 2000. The disclosure breaches had facilitated the preservation of the 35 per cent stake, and its placement with share trader Active Equities, from whom PPCS re-bought the shares. The series of transaction with Active Equities cost PPCS more than $20 million.

Richmond shareholder and lawyer Robin Bell, whose group took the case against PPCS along with Richmond, urged PPCS shareholders to make their directors accountable.

"We think that if that had been done at an earlier stage they wouldn't be in the situation they're in now. We feel sorry that they have these self-inflicted wounds but we are not hostile to them as shareholders."