Trinidad and Tobago conglomerate ANSA McAL is heading back to the law courts, as it shows no sign of backing down from its bid to buy out Banks Holdings Limited (BHL).
However, this time around, the company is not going it alone; it has won the support of major BHL shareholders who collectively hold over 100,000 shares.
In statement this evening, President and Chief Executive Officer of ANSA McAL (Barbados) Nicholas Mouttet served notice they will be appealing last Friday’s decision by Chief Justice Sir Marston Gibson to lift an injunction that blocked the sale of Barbados’ largest beverage company.
“The company will be joined by several other BHL shareholders who intend to bring a class action suit against BHL with a view to getting the “10 Put Option” clause removed from the BHL/SLU agreement.”
The controversial exit clause outlined in the 2010 agreement between BHL and St Lucia Beverages has been a major bone of contention. ANSA and disgruntled shareholders argue that it gives SLU, which is owned by Brazilian conglomerate AMBEV, an unfair advantage in the bidding process.
The agreement stipulates that if any person or group becomes the direct or indirect ultimate owner of BHL shares, representing more than 25 per cent of the total voting power in the Barbadian company, then SLU has the ability to require BHL to re-purchase, at $10 per share, the 13,250,000 common shares which were issued to SLU on conversion of the debt in 2010.
The ANSA chief said the lawsuit would contest the validity of the “Put Option” clause, challenge its legality and seek to prove that it is disadvantageous to all shareholders other than SLU/AMBEV.
“A major concern of the litigants is that the $10 ‘Put Option’ was inserted into the BHL/SLU agreement without shareholder permission and therefore may be unenforceable.
“ANSA McAL and the other shareholders are in agreement that they are fighting for a fair and level playing field to ensure that shareholders can get maximum value for their shares.”
Mouttet further argued his case by pointing to a circular issued by BHL directors on October 28 which warned that if AMBEV invoked the clause it would have serious financial consequences, if anyone other than the Brazilian giant acquires 25 per cent or more shares of BHL.
He added that the class action suit would also make the point that the actions of BHL directors “negatively impacted all shareholders and the image and reputation of the private sector and of Barbados.”
Just yesterday, AMBEV, which owns just over 40 per cent of the publicly-traded BHL upped its share offer to $6.20.
Back in September it has initially offered shareholders BDS$4 per share to acquire the remaining shares, but a week before the offer was set to expire ANSA McAL, through its subsidiary A.M Caribbean Development Ventures Limited, countered with a BDS$5.20 offer. AMBEV responded by raising its bid to BDS$5.60 prompting its rival to heighten the stakes by offering BDS$6 per share.