Yes. I have posted about this several times before, during the 23/24 takeover. In summary there are two CA powers- ins661A and s664A of Corporations Act. The first can only be used if you start from less than 90%, the second only if you have over 90%.They have different requirements. The second CA is NOT made under a takeover bid.
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You are correct that s661A (which is by far the more commonly used CA method) has TWO tests, BOTH of which must be satisfied: reach 90% during your takeover AND get more than 75% of what you did not own at the beginning. If you start at 88% that means 75% of (100%- 88%) = 9%. Thus if RG announces a second takeover now with a starting point of 88% he must reach over 88% +9% = 97% before the end of the bid to be allowed to use CA.If more than 3% of the remaining holders refuse to accept the bid RG cannot possibly achieve 97% and so he can’t use the CA power in s661A.
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That is why he was so desperate to reach 90% in the 23/24 bid. In that case he started at only 50% so the second test threshold was 50% + 75% of the 50% remainder = 87.5%. Thus he DID (just) satisfy the second test in that bid but just failed on the first test of 90%.He got very close but he failed; if he had got 90.001% in 2024 he would have passed both tests and could have proceeded with CA.He caused his own problem- he was too mean with 84c and he imposed the 7 June deadline. That was why he kept shouting about delisting last year- he must have hoped that owners of at least another 2.001% of shares would panic on the delisting threat, sell to him whilst the bid was live, to get just get over 90%.His threat didn’t work.He has only himself to blame. He overplayed his hand.The history and numbers of that bid can’t be reopened. He must now get to 97% in a second takeover to be able to use CA. OR he can buy 2% on market, and then use the s664A alternative CA method, which is not under a takeover. BUT on my reading this is even tougher.S664AA says that that CA power can only be used within 6 months after he hits 90%. Secondly, there is (I think) an extremely tough condition in s664A(3). On my reading, if holders of 1.001% objected to the Court re the terms that he offered, he couldn’t win, unless the Court overrules them. The drafting is confusing and I would welcome a lawyer confirming this.My reading is that s664A CA can be blocked by 10% of 10% =1%.
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Either way I think RG can blocked by holders of 3% (or 1% in the s664A case) - unless the Court overrides the s664A objectors as being unreasonable.
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This is the big picture. RG painted himself into a corner in 2024 by being too mean with 84c, and declaring the bid final so he couldn’t tweak it upwards by say 5c to win more acceptances, even after he blustered with the threat of delisting.
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RG is now at a stalemate- he can’t reach 100% unless all but 3% or perhaps even 1%. accept his terms. The current threat of imminent delisting is very annoying for shareholders but it will not solve his strategy problem. Of course RG does not have to buy any more shares- he can leave a stand off and hope that -after a few years of nothing happening- the minorities will blink first, but I think that scenario is very unlikely. This is high stakes stuff.I am not a lawyer* and I would welcome anyone critiquing my comments.
* In particular I understand thatboth s661A and s664A apply even if PGH is unlisted, providing there are 50+shareholders. I would like a lawyer to confirm that.
DYOR. Not advice.
(20min delay)