aussie, another self opiniated excerpt from the AFR, just after...

aussie, another self opiniated excerpt from the AFR, just after sunspension:-

ASX turns Antares stars out

Perth's Texas land-trading oil junior Antares Energy has been suspended from the ASX after refusing to indulge disclosure orders from the market operator.
The chairman, chief executive, investor relation manager and senior shareholder of Antares is Duntroon-trained James Cruickshank. On September 7, Cruickshank announced a $250 million deal to sell his company's two best oil and gas prospects in the emerging West Texas shale play that is the Permian.
There is nothing controversial about that plan. Buying and selling undeveloped oil plays is what Antares does. What is controversial though is that, for a second time in the recent past, Cruickshank has announced a whopping deal without confirming the name of his customer.
For the record, Antares became a bit of a hobby for us last year when it attracted the interest of a junior US activist fund called Lone Star Value Investors. Having invested $5 million of spare change in building a 5 per cent position in Antares, Lone Star's principal Jeff Eberwein attempted a boardroom putsch on the back of management's inconclusive efforts at asset sales.
The focus of Eberwein's carefully manufactured anxiety was a failed land deal in 2013 that saw Antares accept and then, for no obvious reason, reject a $US300 million land sale. Eberwein was attracted to Antares by the gap between the value expressed in that deal.
Eberwein never made it to the board and Lone Star subsequently took its leave from the register at a healthy profit in the wake of a $US74 million land deal that did happen.
From what we understand, the ASX's relative intolerance for failure on this point of disclosure is inspired by the unhappy experience that was a $US6 billion port-funding deal that was announced on the market platform by Padbury Mining in April 2014.
Padbury shares jumped 170 per cent on the back of an announcement that contained no detail about the source of the remarkable quantum of readies. Under pressure from ASX and ASIC, Padbury eventually confirmed that its funding package was being assembled by a Sydney entrepreneur with an exotic past and an unfinancial present.
The funding did not arrive. But the corporate cop did. Last June ASIC confirmed it would pursue bans and financial penalties for Padbury's chairman and its chief executive.
More relevantly to the Antares matter, the ASX has subsequently updated its guidance of the disclosure obligations of companies announcing material transactions. Enlightened by the Padbury experience, ASX now requires the naming of parties to a contract of substance.
But Cruickshank is having none of that. Though his latest deal was announced as a signed sale-and-purchase contract, Mr Antares says disclosure would jeopardise completion. Cruickshank reported on Tuesday that he had received more than 50 calls from "other companies and intermediaries" trying to identify the private buyer in the hope of presenting alternative transactions.
"This has the potential for the Antares deal to be adversely affected and/or terminated and dramatically changes the risk profile of the deal," Antares said in a statement.
ASX frustration with the Antares intransigence was made unusually obvious in the statement issued to confirm suspension. It was observed, for example, that Antares would need balloted approval from shareholders before the proposed deal could be done. ASX noted it was "inconceivable" that the notice calling shareholders to a meeting "would not include the identity of the purchaser".
In the end, ASX regards the company's failure to name its counterparty as a potential breach of the continuous disclosure rules. If ASIC has not been advised of this failure already then it so will be. And that means Antares runs the risk of inviting civil or criminal sanction should it sustain its failure to comply with disclosure orders.
There will be only one winner here. And it will not be Cruickshank.


I beg to differ on the last sentence. More likely several winners including James.

Cheers IFINO