RNA should honour undertaking – Westfield
29 October 2001
Countries: United States
Westfield Holdings today announced it would request theEnterprise Chamber of the Amsterdam Court of Appeal to ensure RNA’sboards honour their undertaking to the chamber not to alter thebalance of power in relation to RNA’s share structure.
This follows statements by RNA director, Mr Tim Koster,confirming that RNA management is actively seeking ways to alterthe ownership structure of the company while the matter is underinvestigation by an independent panel appointed by the chamber.
Last week Mr Koster was quoted in the Australian media as sayingRNA was exploring three options, namely, “preserving itsindependence, seeking a new buyer for Westfield’s stake in case thecourt investigators allow the trust to stand, or finding a buyer tomake a public bid for all of RNA’s shares.”
Mr Koster’s comments are at odds with an undertaking given byRNA to the Enterprise Chamber and referred to in paragraph 3.22 ofits ruling last week: “RNA has stated that it has no intention ofchanging the current balance of power and there are no reasons toassume otherwise.”
Given this apparent departure from the ruling of the EnterpriseChamber, and its potential to undermine the investigation into RNA,Westfield will ask the chamber to reconsider RNA’s undertaking inlight of its public comments.
In a separate action, RNA has informed Westfield it intends toissue a writ against Westfield claiming that Westfield’s purchaseof its 23.9% interest in RNA is void. RNA would also start asimilar legal action against ABP. The Rotterdam District Courtwould hear these claims.
This is despite the fact that only two weeks ago the EnterpriseChamber held that Westfield’s purchase of the interest from ABP wasin compliance with the relevant rules of Dutch civil law and thatRNA’s claim on the validity on the contract could not besubstantiated or made clear by RNA, according to this court.
Westfield has agreed to accept the service of RNA’s writ inHolland immediately despite being able to delay the service of thewrit for several months to deny RNA the opportunity to furtherdelay proceedings.
Westfield Chairman, Mr Frank Lowy, said: “Westfield is confidentabout the outcome of this litigation. I am sure that the courts inthe Netherlands will quash this latest frivolous claim.”
Last week the Enterprise Chamber held that there were seriousgrounds to question the conduct of RNA’s boards in issuing phantomshares to a captive voting trust and ordered an investigation by anindependent panel into mismanagement by RNA.
Westfield has said consistently that legitimate shareholdersshould be given the opportunity to decide the company’s future andregards RNA’s continuing obstruction as a waste of shareholders’money and a disgraceful disregard of their interest.