Tower suite await panel decision

By PAULA OLIVER

Tower's $210 million recapitalisation has a confirmed suite of sub-underwriters, but they will have to wait until later this week to hear whether their Guinness Peat Group-led deal has approval from the Takeovers Panel.

The panel has forced GPG to apply for a specific exemption from the Takeovers Code if it wants to go ahead with the underwriting of Tower's rights issue.

Most observers predict that GPG will win the exemption.

The problem centres on a complaint from Hanover Group that GPG could, as a result of underwriting the issue, gain 20 per cent of the voting rights in Tower.

Under the deal, GPG is restricted to picking up 15.6 million shares, or a total stake of 13.75 per cent of Tower.

GPG can however pick up any other leftover shares - on the condition it sells them down within six months and does not have voting rights on them.

GPG's Tony Gibbs would not comment on the Takeovers Panel move yesterday, but did confirm that the process of signing up sub-underwriters was complete.

It is understood they include local fund managers such as AMP Henderson, but not hedge funds.

The Takeovers Panel has asked for comments on GPG's possible exemption from related parties.

Shareholders Association chairman Bruce Sheppard yesterday said he would like an intermediary party to be set up to control any selldown of shares GPG might have to do.

He said that GPG should not be able to control who it sold to.