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From SMH


Brockman takeover may go back to ASIC
May 17, 2011

A HONG KONG-BASED company, Wah Nam International Holdings, has amassed a controlling stake in the iron ore explorer Brockman Resources.

However, Brockman is crying foul and says it may seek intervention by the Australian Securities and Investments Commission.

Brockman, 51.99 per cent of which is now held by Wah Nam, says it remains concerned that its biggest investor has stockpiled a bigger-than-permissible interest via alleged related-party transactions.
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Under the Corporations Act, a company cannot hold a stake of more than 20 per cent in another firm without formally declaring a takeover.

But Brockman said parties had taken a stake in it before Wah Nam's takeover was announced, but had not declared an association with Wah Nam. The takeovers panel rejected in January Brockman's request for a declaration of unacceptable circumstances on these grounds.

Brockman said acceptances into the takeover offer between May 11 and 13 appeared to be mainly from offshore shareholders, including some identified in its application to the panel.

But Wah Nam said Brockman's Australian-registered shareholders, excluding Wah Nam and Brockman directors, held only 21 per cent of Brockman shares.

''Therefore, it is not surprising that the majority of acceptances to date have been ? received from shareholders with addresses registered outside Australia,'' Wah Nam said.

The bid of 30 Wah Nam shares for each Brockman share valued the target at $932.2 million when it was launched on November 11. Brockman's shares were down 3? at $4.45 yesterday, while Wah Nam's Australian-listed shares were steady at 19.5?.

Read more: http://www.smh.com.au/business/brockman-takeover-may-go-back-to-asic-20110516-1epwp.html#ixzz1MYkhRBkV