Lawyers representing the Securities Commission will go to court today to try and prevent Bernard Terence Whimp, a convicted burglar, former bankrupt and current banned company director, taking control of any shares through his latest “low-ball offers”.Limited partnerships (LPs) controlled by Whimp were orderd by the regulator to correct “misleading” share offers to investors in five NZX-listed companies by Tuesday evening (22 March) and to confirm by midday yesterday they had done so. Howevver, a commission spokesman said yesterday that it had not received the confirmation and so it had applied to the court for an urgent interim injunction to prevent the transfer of shares from any investors who had accepted the offers. (Investors had been given until 25 March 6 pm by Whimp’s LPs to take up the share purchase offer).
The offers made to “mum and dad” investors are not illegal, but the information in the letters of offer are “misleading” according to the Securities Commission.
They appear on face value to offer a premium to the current market value, but only the fine print indicates that payments would be made to sellers, in annual instalments over a decade, and the limited partnerships (LPs) controlled by Whimp purchasing the shares, would receive all dividends. Furthermore, no information is providedc on the financial soundness of the LPs and the lack of security being offered to sellers who will be drip-fed payments over ten years, are factors making the deal very problematic.
The Society (SPCS) contends that the public needs to be aware that dishonest business practices are costing the country tens of millions of dollars in lost revenue eah year. It applauds the vigilance of regulators and enforcement agencies such as the Securities Commission.
Injunction sought to stop Whimp controlling shares. By Hamish Rutherford. The Dominion Post 24 March, 2011, C1
Note: Mr Bernard Terence Whimp was banned as director from 19 April 2007 to 19 April 2012 under section 382(1) of the Companies Act 1993. See List of disqualified company directors: www.companies.govt.nz