opes sell off slows

ANZ's Opes sell-off slows
Article from: The Australian


By Susannah Moran

April 21, 2008 12:00am

ANZ has slowed the selling off shares obtained from Opes Prime as it reaches the illiquid portion of shares in small-cap companies.
Judge Ray Finkelstein is today set to begin hearing a case brought by Beconwood Securities in Melbourne. The case will have huge implications for Opes clients, examining the legal implications of the contracts they signed.

If the bank is forced to go back to the market to buy shares in a number of small, tightly held companies, it could be forced to pay a premium for them.

ANZ spokesman Paul Edwards said yesterday the bank had sold off several million shares on Friday but that sales had slowed and it would take months to sell down its holdings. In some cases, he said, the bank owned stakes in companies that were larger than several years trading volume.

In legal proceedings on Friday, the NSW Supreme Court of Appeal heard evidence that Goldman Sachs, ANZ's broker, was no longer dealing with a block of shares in Conquest Mining.

"The shares are being controlled directly by ANZ," Royal Bank of Canada's Peter Main is said to have been told by Goldman Sachs. Earlier in the case, ANZ's Antony Cahill said in an affidavit that the bank "had no involvement in the day-to-day decision-making process in relation to the realisation of the securities -- that is a matter for Goldman Sachs".

A spokeswoman at Deloitte said yesterday that people who wanted to buy shares were being asked to put their offers in writing to Deloitte, as receiver, which was then passing on the offers to the secured creditors -- ANZ, Merrill Lynch and Dresdner Klienwort.

Mr Edwards said yesterday that ANZ was talking directly to people who were interested in buying various shares.

The issue of damages is likely to loom large in the wider court hearing brought by Melewar Steel Ventures and Conquest's John Terpu if they are ultimately successful in their court battle, as ANZ gained approval on Friday to sell 23.5 million shares in Gindalbie Metals and Conquest.

ANZ's lawyers had told the court they wanted to sell the shares because it was concerned about falling prices. It was suggested by the bank that Opes customers could themselves buy back shares from ANZ, which would help them crystallise a future damages claim.

But even that could prove tricky, with Conquest Mining's Mr Terpu saying Goldman Sachs was, at one stage, prepared to sell "his" shares at 15 per cent below their market value.


source: http://www.news.com.au/dailytelegraph/story/0,22049,23572224-5014099,00.html