KEY POINTS:
A Feltex shareholder has lodged an application at the High Court in Auckland to have shareholder activist Tony Gavigan appointed to the Feltex board.
Ian Hamilton, of Invercargill, who owns 172,000 Feltex shares, lodged the application on October 27, The Dominion Post reported today.
Mr Gavigan, who is an auditor, is gathering a group of Feltex shareholders to take legal action against several parties associated with the float of the now defunct carpet company.
Feltex is under the control of receivers McGrath Nicol & Partners and has had no directors since they all resigned on October 20.
Mr Gavigan said the action was being taken because of concerns the receivers were acting solely in the interest of their secured creditor appointee and were selling Feltex assets too cheaply.
He suggested Feltex may have been worth more broken up, rather than being sold as a going concern.
Mr Gavigan said that being a Feltex director would also give access to documents that could be used in a class action.
Feltex's Australian rival Godfrey Hirst has agreed to buy the company.
Receiver Colin Nicol said the sale of Feltex complied with statutory obligations in New Zealand and Australia.
The process was reviewed by an independent expert in New Zealand, Ferrier Hodgson, and legal opinions were also obtained from senior counsel in both countries.
"A break up sale would have triggered significant redundancy payments in Australia, which would have greatly reduced the sale price compared to the going concern sale outcome to Godfrey Hirst," Mr Nicol said.
- NZPA
