Vineyard sales open to scrutiny

Oyster Bay Marlborough Vineyards shareholders will get the chance to approve annual negotiations with Delegat's Wine Estate over the sale of its grapes, the New Zealand Exchange has ruled.

Oyster Bay's next annual meeting, in November, will be the first time that shareholders will get the chance to peruse the grape purchase agreements with its largest shareholder, Delegat's Wine Estate.

The ruling was another win for Peter Yealands, the second-largest shareholder. He has been battling Delegat's over control of the vineyard.

The NZX decision said that Oyster Bay breached the conditions of a stock exchange waiver that allowed it to negotiate with Delegat's without shareholder approval.

Oyster Bay had argued for the waiver on several grounds, including that the price negotiation process had been accepted by shareholders when they bought shares and the prices were negotiated on an arm's length and commercial basis.

It also argued that for shareholders to vote on the annual grape price would be impractical because shareholders rely on the opinion of Oyster Bay directors to know if the price was fair.

Yealands applied to the NZX to revisit Oyster Bay's waiver on the grounds that the viticulturalist at the centre of the negotiations was not independent.

Last week, the Takeovers Panel ruled Oyster Bay had breached the takeover code when it failed to disclose the market value of its freehold and leasehold vineyards in its target statement to shareholders.

The panel also ruled that Oyster Bay shareholders could revoke their acceptances of the Delegat's offer after receiving the new information.

Delegat's and Yealands had until 5pm yesterday to submit their recommendations on the panel's ruling. The panel is expected to release more details today on how best to resolve the matter.