Published 30 December 2010
NZX Market Supervision has granted Investment Research Group Ltd a waiver from the requirement to get shareholder approval for its sale of the McEwen Investment Report back to former owner David McEwen.
The NZX released the details of Investment Research Group’s sale announcement on Christmas Eve but withheld announcement of the company’s request for waiver & confidentiality until today. Confidentiality was sought only until the agreement was signed & announced to the market – in other words, until Christmas Eve.
While the waiver was granted, NZX Market Supervision disagreed with some of the company’s reasoning, particularly the assertion that the $225,000 sale (payable over 4 years) “is only a material transaction because of the deterioration in IRG’s financial position and the resultant impact on its share price, and in such circumstances it would be an unreasonable restriction on IRG’s ability to realise assets to require shareholder approval”.
The company said its market capitalisation at 7 December was $1,064,677, making this deal (albeit a time payment) equal to 21% of market capitalisation. The values of both IRG & the asset being sold back to Mr McEwen have slumped since IRG bought the investment report & other assets from Mr McEwen & his business partner in March 2007.
NZX Market Supervision said it accepted Mr McEwen didn’t instigate the transaction and that it had been negotiated & entered into on an arm’s length & commercial basis, that Mr McEwen was the logical buyer and that sale to anybody else wouldn’t be at a better price. Earlier stories:
24 December 2010: IRG sells investment report business back to McEwen
15 September 2010: Latest count turns Kingâ€™s IRG from profit to loss
22 June 2010: IRG shares suspended
12 August 2008: Viking becomes Investment Research Group
15 June 2008: Viking makes $15 million loss
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Attribution: Company release, story written by Bob Dey for the Bob Dey Property Report.