HopgoodGanim Lawyers successfully defends hostile off-market bid for Brisbane Markets Limited

On 1 July 2016, a bid for HopgoodGanim’s client Brisbane Markets Limited (BML) by Produce Markets Queensland Pty Ltd (PMQ) lapsed, ending a lengthy and hostile takeover process with success for BML. 

PMQ, a subsidiary of Sydney-based private equity fund VGI Partners Pty Ltd (VGI), announced a bid for all BML shares not already held by VGI (2.2% at the time) at a price of $3.50 per BML share, to close on 26 March 2016.  The offer was subject to a number of conditions including that Brismark, a cooperative registered under the Qld Cooperatives Act the largest shareholder in BML, relinquish certain special rights that attached to its “industry shares” in BML.  

Following an aggressive media campaign by VGI, BML and Brismark sought a declaration of unacceptable circumstances from the Takeovers Panel in respect of a number of what BML considered to be false and misleading statements made in PMQ’s bidder’s statement and in the media. These statements concerned, amongst other matters:

  • the effect of the pre-bid agreement;
  • VGI’s intentions for BML in the event of a successful acquisition of BML;
  • the assertion that the bid in effect included an offer of $1million dollars for each Brismark member if Brismark were to accept the offer;
  • the effect of PMQ’s offer on Brismark members; and
  • the arrangements for funding of PMQ’s bid. 

PMQ corrected these statements in accordance with orders made by the Takeover’s Panel.

On 18 March 2016, VGI/PMQ sought to extend the offer period to close on Friday, 1 July 2016.  However, BML and Brismark relentlessly pointed out that the purported notice of variation was defective at law because it sought to limit the ability of accepting shareholders to withdraw their acceptances. VGI/PMQ was unable or unwilling to address this defect, with the result that the bid had, in all likelihood, already expired on 26 March 2016. In any event, few if any shareholders appeared convinced by VGI/PMQ’s offer, born out of the fact that based on VGI/PMQ’s notices, acceptances for only 0.32% of BML Shares were received.

On Friday, 24 June VGI/PMQ announced that they did not intend to waive the conditions and, accordingly, the bid lapsed on 1 July. 

HopgoodGanim Lawyers warmly congratulates BML on a hard-won and entirely deserved victory.  Despite becoming the subject of a vicious media campaign, the BML team remained resolutely determined to ensure that their shareholders received all of the facts, so as to enable them to make fully-informed decision as to the merits of the bid. During this time, BML management prioritised business as usual, ensuring that the markets were run as efficiently as possible for the benefit of all its stakeholders.

Partner Nicole Radice led the team from HopgoodGanim Lawyers, assisted by Special Counsel Peter Burge and Senior Associate Luke Dawson.