Southern loser lines up new bid

By PHILIPPA STEVENSON

Vanquished southern meat company PPCS plans to resume discussions with its northern nemesis Richmond today to forestall a High Court judgment forcing it to buy out or bail out.

In a judgment issued on Friday, Justice William Young ordered PPCS to make a successful takeover offer for 90 per cent of Richmond or lose all influence in the company it has fought five years to control.

He ordered PPCS to forfeit shares worth around $10 million, and pay the court costs of Richmond and a group of its shareholders who took the case.

The combined bill is estimated to be around $2 million.

PPCS has 10 days to appeal against the decision, a move which would maintain its effective 53 per cent control of Richmond for the duration of the proceedings.

But yesterday PPCS chief operating officer Keith Cooper said that while an appeal would be considered, "we all believe there is some opportunity for some commercial realities to apply".

Before the judgment, PPCS and Richmond's independent directors had been discussing a proposal for Richmond's ownership which could be "a positive outcome" to both companies' shareholders, he said.

"I think we were making some very positive progress," he said.

He expected the discussions to continue today.

The cost of the case had been high, so "most people want to move on with a commercial solution rather than carry on the court way", Cooper said.

Richmond chairman Sam Robinson said discussions had been held before the judgment was issued, but he was unaware PPCS planned to continue the same line.

"Richmond is always willing to discuss with its major shareholder the plans it has for the company," he said.

But he doubted there were any grounds to ask Justice Young to re-consider his judgment if the parties should agree to an alternative proposal, although he would need legal advice to confirm this view.

"He's made his decision and we believe it's a sound one," he said.

The judgment provided a basis for ending the uncertainty that had plagued Richmond for five years.

"In the event of a takeover offer from PPCS, the choice of future owner of the company will rest squarely with the other shareholders, which is entirely appropriate," Robinson said.