2010/419

Notice

Takeovers Code (Delegat's Wine Estate Limited ) Exemption Notice 2010

Contents

  1. Title
  2. Application
  3. Expiry
  4. Interpretation
  5. Exemption from rule 20 of Code
  6. Conditions of exemption in clause 5
  7. Exemption from rule 56A(2) of Code
  8. Exemption from rule 56A(3) of Code
  9. Conditions of exemptions in clauses 7 and 8

Notice

1
Title
This notice is the Takeovers Code (Delegat's Wine Estate Limited) Exemption Notice 2010.
2
Application
This notice applies to acts or omissions occurring on or after 8 November 2010.
3
Expiry
This notice expires on the close of 30 June 2011.
4
Interpretation
(1)

In this notice, unless the context otherwise requires,-

acquisition notice means the acquisition notice that is required by rule 54 of the Code for a compulsory sale

Act means the Takeovers Act 1993

cash consideration means the cash consideration offered to shareholders in Oyster Bay under the offer

Code means the Takeovers Code under the Act

compulsory sale means a compulsory sale that occurs as a result of the offer

Delegat's means Delegat's Wine Estate Limited

Delegat's Group means Delegat's Group Limited

foreign shareholder means a person who, at the time that the cash consideration or the share scrip consideration is paid, is registered as a shareholder in Oyster Bay and whose address on Oyster Bay's share register is not in New Zealand or Australia

offer means the full takeover offer (involving the offer of either cash consideration or share scrip consideration) to be made by Delegat's for all of the equity securities in Oyster Bay that Delegat's does not already hold

Oyster Bay means Oyster Bay Marlborough Vineyards Limited

share scrip consideration means the ordinary fully paid shares in Delegat's Group offered to shareholders in Oyster Bay under the offer.

(2)
Any term or expression that is defined in the Act or the Code and used, but not defined, in this notice has the same meaning as in the Act or the Code.
5

Exemption from rule 20 of Code
Delegat's is exempted from rule 20 of the Code to the extent that the share scrip consideration relates to foreign shareholders.

6

Conditions of exemption in clause 5
The exemption in clause 5 is subject to the conditions that-

(a)
Delegat's appoints a person to act as nominee for the offer who-
(i)
is designated as an NZX Trading and Advising Firm by NZX Limited; and
(ii)
is not, to the best of Delegat's knowledge, under investigation by the Securities Commission or NZX Limited; and
(b)
in a manner consistent with the terms of the offer, Delegat's procures the allotment to the nominee of the shares in Delegat's Group that would otherwise be allotted to foreign shareholders who accept the share scrip consideration under the offer; and
(c)
Delegat's uses its best endeavours to ensure that the nominee, as soon as is reasonably practicable and in a manner consistent with the terms of the offer relating to payment of consideration, sells the shares in Delegat's Group that are allotted to the nominee under paragraph (b); and
(d)
Delegat's uses its best endeavours to ensure that the nominee, as soon as is reasonably practicable and in a manner consistent with the terms of the offer relating to payment of consideration, pays to each foreign shareholder the relevant share of the proceeds from the sale of the shares in Delegat's Group under paragraph (c), net of any applicable brokerage costs and taxes, to which that shareholder is entitled; and
(e)
Delegat's indemnifies each foreign shareholder against any costs or losses suffered by that shareholder as a result of a failure by the nominee to perform its obligations in a proper manner.
7

Exemption from rule 56A(2) of Code
Delegat's is exempted from rule 56A(2) of the Code to the extent that Delegat's is required to provide the share scrip consideration to foreign shareholders under a compulsory sale.

8

Exemption from rule 56A(3) of Code
Delegat's is exempted from rule 56A(3) of the Code to the extent that Delegat's is required to provide the share scrip consideration to foreign shareholders as default consideration under a compulsory sale.

9

Conditions of exemptions in clauses 7 and 8
The exemptions in clause 7 and 8 are subject to the conditions that-

(a)
Delegat's appoints a person to act as nominee for a compulsory sale who-
(i)
is designated as an NZX Trading and Advising Firm by NZX Limited; and
(ii)
is not, to the best of Delegat's knowledge, under investigation by the Securities Commission or NZX Limited, and
(b)
in a manner consistent with the terms of the acquisition notice, Delegat's procures the allotment to the nominee of the shares in Delegat's Group that would otherwise be allotted to outstanding security holders who are foreign shareholders who-

(i)
nominate the share scrip consideration under the compulsory sale; or
(ii)
would receive share scrip consideration at default consideration; and
(c)
Delegat's uses its best endeavours to ensure that the nominee, as soon as is reasonably practicable and in a manner consistent with the terms of the acquisition notice relating to payment of consideration, sells the shares in Delegat's Group that are allotted to the nominee under paragraph (b); and
(d)
Delegat's uses its best endeavours to ensure that the nominee, as soon as is reasonably practicable and in a manner consistent with the terms of the acquisition notice relating to payment of consideration, pays to each outstanding security holder who is a foreign shareholder the relevant share of the proceeds from the sale of the shares in Delegat's Group under paragraph (c), net of any applicable brokerage costs and taxes, to which that shareholder is entitled; and
(e)
Delegat's indemnifies each outstanding security holder who is a foreign shareholder against any costs or losses suffered by that shareholder as a result of a failure by the nominee to perform its obligations in a proper manner.


Dated at Auckland this 10th day of November 2010.

The Common Seal of the Takeovers Panel was affixed in the presence of:

Colin Giffney
Deputy Chairman

Statement of reasons

The notice applies to acts or omissions occurring on or after 8 November 2010 and expires on the close of 30 June 2011.

Delegat's Wine Estate Limited (Delegat's) is proposing to make an offer for the equity securities in Oyster Bay Marlborough Vineyards Limited (Oyster Bay) that it does not already hold (the offer), As consideration for the securities in Oyster Bay, Delegat's proposes to offer Oyster Bay shareholders a choice of cash or Delegat's Group Limited (Delegat's Group) shares (the share scrip consideration).

The Takeovers Panel has exempted Delegat's subject to conditions, from-

(a)
rule 20 of the Takeovers Code (Code) to the extent that the share scrip consideration relates to shareholders that reside in any jurisdiction other than New Zealand or Australia (foreign shareholders); and
(b)
rule 56A(2) of the Code to the extent that Delegat's is required to provide share scrip consideration to foreign shareholders under a compulsory sale that results from the offer; and
(c)
from rule 56A(3) of the Code to the extent that Delegat's is required to provide share scrip consideration to foreign shareholders as default consideration under a compulsory sale.

The conditions of the exemptions provide that shares in Delegat's Group that would otherwise be allotted to foreign shareholders under the offer or under a compulsory sale will be allotted to a person appointed by Delegat's to act as nominee for the offer or compulsory sale. Delegat's is required to ensure that that nominee, as soon as is reasonably practicable and in a manner consistent with the terms of the offer or the acquisition notice relating to payment of consideration, sells the shares in Delegat's Group and pays the net proceeds arising from the sale to the relevant foreign shareholders.

The Panel considers that the exemptions are appropriate and consistent with the objectives of the Code because-

  • it is impractical and unreasonably expensive in the context of the offer for Delegat's to make an offer to all shareholders on the Oyster Bay share register on the same terms, as required by rule 20 of the Code, because of the costs of complying with the securities laws that apply in the various jurisdictions; and
  • the conditions of the exemptions require that foreign shareholders that accept the share scrip consideration under the offer will, in effect, receive equivalent cash consideration and accordingly are not disadvantaged by not being able to accept the share scrip consideration under the offer; and
  • the exemptions are consistent with the principle of providing equal consideration to all shareholders of the same class; and
  • it is important for competition for the control of Code companies that offerors are not precluded from offering securities as consideration in takeover transactions; and
  • the exemptions from rule 56A(2) and (3) of the Code are consequential to the exemption from rule 20 of the Code.

Issued under the authority of the Acts and Regulations Publication Act 1989.
Date of notification in Gazette:
This notice is administered by the Takeovers Panel.