Share sales focus shifts to Montana chairman

By FRAN O'SULLIVAN assistant editor

Montana Group chairman Peter Masfen faces stock exchange scrutiny over share sales he made to British liquor company Allied Domecq during the protracted takeover battle for New Zealand's premier wine company.

Mr Masfen was not available for comment last night. But Allied Domecq said it had been "absolutely meticulous" in everything it had done.

The Business Herald has established that Australasian brewer Lion Nathan - itself ruled in default of the exchange's takeover rules - made the default allegation against the Montana chairman last month after he sold the bulk of his remaining stake to Allied Domecq.

The alleged default will be brought in front of the standing committee which the Stock Exchange's market surveillance panel empowered nearly four months ago to examine similar allegations against Lion Nathan.

The revelation of the new default allegation was made in a press statement last night by the panel, which had spent two days assessing whether to step in to resolve the Lion Nathan defaulter securities issue.

Panel member Bill Falconer said the panel would take up responsibility for ruling on both issues. This would effectively push Montana's independent directors out of the picture.

The panel would put both the Lion Nathan default issue and the new allegations involving Mr Masfen and Allied Domecq in front of the standing committee. This is comprised of Sir Duncan McMullin, Sir Ian Barker and Bill Wilson, QC.

The Lion Nathan issue would be dealt with first.

"The process is as it should be but the panel is taking responsibility for stepping forward for quarter-backing it, if you like," Mr Falconer said.

That committee last week attracted market criticism over its ruling that Lion Nathan had violated takeover rules by acquiring Montana shares before a takeover pause period was lifted.

Many brokers believed that the committee had taken a legalistic view of what they claimed was simply normal book building by Lion's agents, Credit Suisse First Boston.

The panel has reserved the right to add extra players to the committee in the interests of achieving a swift and credible resolution.

Montana deputy chairman Barry Neville-White, who heads the independent directors, said last night that he thought the panel's move was "very sensible."

Allied Domecq corporate affairs director Jane Mussared said Allied was delighted the standing committee was back in the picture.

Ms Mussared said Allied rejected the new allegation.

Lion Nathan chief executive Gordon Cairns said he accepted the panel's decision to refer the issue back to the standing committee. "Our concern is for Montana the company, and our hope is that this is handled expeditiously so Montana can have commercial certainty."

Mr Cairns said the panel had requested the parties not to comment on the new allegation.