Asic seeks orders against Lithium Australia

PERTH (miningweekly.com) – The Australian Securities and Investment Commission (Asic) has requested the Takeovers Panel to order ASX-listed Lithium Australia to withdraw its rights over shares obtained in takeover target Lepidico after April 7.

Lithium Australia in February this year announced an off-market scrip bid for Lepidico, offering one of its own shares for every 13.25 Lepidico shares held.

Lepidico in March lodged a target statement in which independent expert BDO Corporate Finance opined that the bid was neither fair nor reasonable.

Lithium Australia in April this year called into question the findings of the independent report, saying that it had employed Leadenhall Corporate Advisory to undertake a review of the BDO report, which found that the independent expert should have been of the opinion that the offer was both fair and reasonable.

Leadenhall alleged that the independent expert placed too much reliance on the quoted market price analysis where there was not a deep and liquid market for the shares to support the analysis, and that the expert had used an inappropriate time period to select the minority trading price.

However, in its application to the Takeovers Panel, the Asic said that Leadenhall did not have objectively reasonable grounds to provide an opinion on the takeover offer, and was not an ‘independent expert’.

As a result, the Asic has applied to the Takeovers Panel for final orders that Leadenhall retract its statements, and that Lithium Australia provides withdrawal rights to all Lepidico shareholders who accepted the takeover offer after April 7, as the Leadenhall statement was likely misleading.

Lithium Australia in May this year extended its takeover offer for Lepidico until June 19.