Richmond lawyer keeps job

By Chris Hutching

Friday 6th December 2002

Meat company Richmond's inhouse legal counsel Chris Abbot emerged yesterday with his job intact after an internal but independent review of his actions during the recent High Court case against southern raider PPCS.

During the course of the trial evidence emerged about the antics of legal advisers of both companies and were the cause for comment by Justice Willie Young, who criticised the two advising lawyers including PPCS legal counsel David Stock.

Richmond's acting chief executive Graeme Milne said his company had carried out a review of Mr Abbot's actions and concluded he should have made Richmond's solicitors aware of false information in an affidavit sooner than he did.

He has been verbally sanctioned but the board of Richmond is now satisfied and he remains with the company.

As outlined in The National Business Review last week, the logical course for PPCS is to stall for time by appealing the recent judgment of Justice Young, which was largely in favour of Richmond over the way PPCS bought shares by placing them with third parties and later re-purchasing them. As a result Richmond shareholders will continue to face uncertainty until the outcome of the PPCS appeal on April 15, 2003.

In the meantime Justice Young has granted PPCS a stay with conditions:

* the Bell Group plaintiffs' costs are to be paid by PPCS immediately;

* The forfeiture of PPCS' 6.7 million Richmond shares is stayed until 10 days after determination of the appeal but has no voting rights in relation to them and the shares are not to be sold or replaced; and

* the deadline for any takeover offer by PPCS has been extended from January 1 to January 24, 2003. Subject to the outcome of the appeal, 90% acceptance remains the threshold for a successful takeover.

The effect of "locking up" the forfeited shares is that PPCS will have to make any bid from the basis of a 43% shareholding, not 52%, as would have been the case before Justice Young's decision.

PPCS chief executive Stewart Barnett said yesterday the company had yet to decide on its favoured course of action and was still exploring options. But analysts have noted that a full takeover is likely given the amounts of money already spent and backlash from PPCS's own shareholders if it gave up and booked losses from the five-year takeover battle.

PPCS has been the subject of several newspaper articles this week highlighting the cost of the takeover and the corporate behaviour that were revealed during the recent court case.

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