Australia: Coopers brought to the court by a former shareholder
A Coopers Brewery’s former shareholder Andrew Short started legal action on September 15 against the South Australian beer maker. His reason- Coopers’ misleading conduct in relation to a share buyback in 2003. Mr.Short stated before Federal Court that the price of A$45.01 offered by Coopers in the buyback did not reflect a fair value, according to The Sydney Morning Herald.
According to Mr Short, he had accepted the representations of Coopers at the time and sold his 1,500 shares.
The former shareholder launched the legal action after the brewer Lion Nathan Ltd earlier this month made a A$352 million takeover bid for Coopers, Australia's only remaining family-owned brewery, at A$260 per Coopers share.Mr Short states that at the time of the buyback in 2003 Coopers had not consulted parties who had pre-emptive rights over Coopers shares, and a valuation of the shares by KPMG had not taken into account the preparedness of those parties to buy the Coopers shares.
Under the Coopers constitution, shares up for sale must first be offered to another Coopers shareholder or relative, secondly to AMP or any other Coopers employee superannuation fund, and thereafter to Lion Nathan.
Mr Short claimed that KPMG had assessed the value of Coopers shares at A$45.01 because it believed they had limited negotiability and lacked liquidity. Coopers wouldn’t have disclosed the true value of its shares and that it knew Lion Nathan was a ready and willing purchaser of Coopers shares.
Lion Nathan, according to Mr Short, was informed of the buyback and the buyback price, and would have offered a much higher price than the KPMG assessed value, perhaps A$100 to A$150 per share.Therefore Mr Short suffered a loss on the sale of his shares.
The former shareholders demands reinstatement of the shares, plus damages and costs.
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