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Flinders Mines changes tack to win over delisting dissidents
Stuart McKinnonThe West Australian
Thursday, 14 February 2019 12:53PMStuart McKinnon

The Takeovers Panel is still deciding on a review against its original finding of unacceptable circumstances.Picture: Danella Bevis
The Takeovers Panel has accepted a range of undertakings by Flinders Mines aimed at making its proposed delisting fairer on minority shareholders of the company.

Earlier this week, the panel made a declaration of unacceptable circumstances in the proposed delisting process, suggesting among other things that it had the potential to coerce shareholders into selling their shares.

Flinders has appealed against the finding but also revealed today that it had made a series of changes to the delisting process that has satisfied the panel’s concerns.

Under the revised terms of the delisting, Flinders will seek ASX approval to change its proposed on-market share buyback to an off-market process via a bookbuild at a fixed price of 7.5¢ a share.



Previously, the buyback price was to be the lower of 7.5¢ or a 5 per cent premium to the average trading price of the stock five days before the on-market purchase, which was likely to be a figure less than half of 7.5¢.

The company will buyback 10 per cent of its stock with any oversubscriptions scaled back on a pro-rata basis.

Flinders will fund the buyback via a three-year loan from its majority shareholder Todd Corporation. A proposed rights issue by Flinders to fund repayment of the loan has been abandoned.

Todd has agreed not to vote shares representing any increase in its voting power (currently 55.56 per cent) as a result of the off-market buyback for 18 months after its completion, and will seek to sell these shares either on-market or otherwise.

Meanwhile, the panel is still deciding on a review against its original finding of unacceptable circumstances from Flinders.

The original panel appellants against the delisting, including the company’s second-biggest shareholder, OCJ Investment (Australia), and shareholder Brendan Dunstan, can also appeal against Flinders’ revised undertakings.

Minority shareholder Margo Gould, who has fought against the proposed delisting, said she was hopeful the ASX would reconsider allowing the delisting process to pass via an ordinary resolution requiring a simple majority.

Ms Gould said minority shareholders wanted Flinders to be forced to pass the motion via a special resolution which would require a 75 per cent majority.

Flinders shares were up 1.2¢, or 33 per cent, to 4.8¢ at 12.50pm.