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Soul Patts spat engages raider Save


By Brian Robins
Dec. 8, 2012, 2:30 a.m.

VETERAN corporate raider Sir Ron Brierley says he is watching with interest the stoush between funds manager Perpetual and Soul Pattinson.


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Sir Ron failed a decade ago in an attempt to dislodge the cross-shareholding that has protected Soul Patts from shareholder pressure to change.

Perpetual is to meet the board of Soul Patts next week to push to unlock the cross-shareholding with Brickworks, although few are holding their breath for any change.

Soul Patts has a 44.41 per cent stake in Brickworks, with Brickworks returning the favour with a 42.72 per cent interest in Soul Patts. The holdings were put in place 40 years ago and had ''provided strength through all points of the cycle'', Soul Patts chairman Rob Millner said at the company's annual meeting on Friday.

Perpetual has been agitating for directors of the two companies to review the cross-holding.

The independent directors of Brickworks did a review recently, telling shareholders at their annual meeting last month that they saw no need for change.

Mr Millner said Soul Patts' board had considered whether value could be created for shareholders from any restructuring. ''As an investment company, ownership of an investment in Brickworks is an entirely consistent strategy,'' he said. ''We remain open to considering value-generating proposals.''

Perpetual, which has a 12 per cent stake in Soul Patts, questioned why the review was undertaken by the full board, and not independent directors.

''All board members are independent in their own way,'' Mr Millner said. ''I don't stand there with a stick over them telling them which way to vote.''


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Perpetual fund manager Matt Williams requested independent directors of Soul Pattinson meet with the independent directors of Brickworks to discuss the matter.

''They left the door open. There could be value in reaching out,'' Mr Williams said.

Meanwhile, Sir Ron said he was still a Soul Patts shareholder and has been a critic of its cross-holdings with Brickworks.

Mr Millner told shareholders that after its final dividend, Soul Pattinson would have cash reserves of $223 million. In the year to July, the company posted a net profit of $142.99 million, down from $362.8 million a year earlier, although the previous result was flattered by a gain from a one-off asset sale.

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