AGRICULTURAL NEWS - Country Bird Holdings (CBH) looks to be on track to block a proposed scheme that threatens to put control of Sovereign Foods out of its reach.
On Monday, Kevin James, CEO of CBH, said the company had secured the backing of 26.6% of Sovereign’s shares. "We either own the shares or have the backing of shareholders sufficient to block the scheme."
Although the scheme had irrevocable support from institutions with a combined 70%, some of the smaller institutions are reported to have sold out to CBH. With just more than 25%, CBH can block the scheme, which needs the support of 75% of shareholders.
The meeting, scheduled for July 25, will vote whether to implement a proposal that would introduce black economic empowerment (BEE) shareholders to Sovereign.
Although the scheme had irrevocable support from institutions with a combined 70%, some of the smaller institutions are reported to have sold out to CBH. With just more than 25%, CBH can block the scheme, which needs the support of 75% of shareholders.
The meeting, scheduled for July 25, will vote whether to implement a proposal that would introduce black economic empowerment (BEE) shareholders to Sovereign.
In addition, the proposal would create an effective control block with top management and BEE shareholders holding 27%. This would make it almost impossible for a third party to wrest control.
Tuesday is the last day to trade to be able to vote at the Sovereign meeting. But even if CBH succeeded in cancelling or delaying the scheme meeting, it might have to sweeten its offer if it wants to gain control of Sovereign.
Tuesday is the last day to trade to be able to vote at the Sovereign meeting. But even if CBH succeeded in cancelling or delaying the scheme meeting, it might have to sweeten its offer if it wants to gain control of Sovereign.
Small shareholders, such as Albie Cilliers and Asief Mohamed of Aeon Investments, are not convinced the offer of R9 a share is sufficiently attractive.
