2005 – Anbran transfer and acquisition
In late 2005 Graham Cowley told Alan Thompson and
Hamish McHardy he wanted to exit the GMS arrangement.
Alan Thompson therefore settled the Anbran Trust to receive the 245,000 Kerifresh shares acquired by GMS. Anbran Trustee Company Limited (Anbran) was incorporated as trustee of the Trust. Its sole director and shareholder was Alan Thompson’s niece, Emma Eastwood, who was also appointer of the Trust. The beneficiaries were Alan Thompson’s children. On 31 October 2005 the 245,000 Kerifresh shares held by GMS were transferred to Anbran.
Anbran acquired a further 116,000 shares to increase its shareholding to 361,000. These acquisitions were made from minority shareholders on 31 December 2005, funded by Hamish McHardy, thereby unwinding the warehousing agreement. The Panel considered that, at the time the warehousing agreement was unwound, Hamish McHardy and Alan Thompson ceased to be associates.
The Panel found that Emma Eastwood, as sole shareholder and director of Anbran, and appointer of the Anbran Trust, controlled the Kerifresh shares acquired by Anbran.
Anbran an associate of Alan and Helen Thompson - Rule 4(1)(d)
The Panel considered that the personal, business and
ownership relationships between Alan and Helen Thompson,
Emma Eastwood, and Anbran were such that, under the
circumstances of Anbran’s acquisition and holding of
Kerifresh shares, they should be regarded as associates under
rule 4(1)(d). The Panel’s reasons for coming to that conclusion
were that:
- Anbran was set up specifically by Alan Thompson as a vehicle for holding shares, which he regarded as his, in a manner that was ostensibly outside the scope of the Code (because he did not control the voting rights);
- Anbran acquired shares with funds provided by Hamish McHardy as a means of increasing McHardy’s economic interest in Kerifresh shares while at the same time providing to Alan Thompson the legal, and not just beneficial, interest in the Kerifresh shares;
- Emma Eastwood had no role in deciding the assets to be acquired by the Anbran Trust. Although Ms Eastwood told the Panel that these matters were decided by Helen Thompson this was not borne out by Mrs Thompson’s evidence. Helen Thompson told the Panel, and Alan Thompson confirmed, that these decisions were made by Alan Thompson;
- Emma Eastwood appeared to have little knowledge of the Trust’s affairs including how Anbran had financed the purchase of Kerifresh shares or had determined the price to be tendered for those shares. She could not assist the Panel with information about the terms of the share transfer. The evidence disclosed that Alan Thompson had attended to all these matters;
- Emma Eastwood had no knowledge of who had deposited the funds into her personal cheque account to fund the payment for the 116,000 shares acquired in the tender as noted in paragraph 84.”(paragraph 86 of the Panel’s 18 October 2007 determination and statement of reasons)
Anbran’s acquisitions caused Anbran and Emma Eastwood to breach rule 6 of the Code. It increased the percentage of voting rights in Kerifresh held by Anbran and controlled by Emma Eastwood to 5.30% which when taken with the percentage of voting rights held or controlled by their associate Alan Thompson (19.26%), exceeded in aggregate 20%. No rule 7 exception was used to effect this increase.
2007 – Lawrence Fletcher’s proposed acquisition
Lawrence Fletcher is a UK resident and an acquaintance of
Jonathan McHardy. In early 2007 he had money on interestbearing
deposit with the Murrayfield Trust as a result of
a previous business venture with Jonathan McHardy and
Hamish McHardy. Lawrence Fletcher was interested in reinvesting
those funds in a suitable New Zealand investment.
Jonathan McHardy suggested Kerifresh as such an investment.
Detailed e-mail correspondence between Jonathan McHardy,
Hamish McHardy and Lawrence Fletcher ensued.
As a result, Hamish McHardy arranged for Auckland law firm Grove Darlow & Partners (Grove Darlow) to act for Lawrence Fletcher in the purchase of Kerifresh shares. In August 2007 Grove Darlow’s trustee company, GDP Trustee Limited (GDP Trustee) acquired 10,000 Kerifresh shares on Lawrence Fletcher’s behalf. Hamish McHardy initially funded that purchase. Lawrence Fletcher immediately repaid Hamish from his funds deposited with the Murrayfield Trust.