| Mon 1 Nov 2004, 11:40 | | Gold Fields to publish attack on hostile bid |
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Gold Fields to publish attack on hostile bid
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Harmony says it has backing
Resources Editor
GOLD Fields executives will this week publish their most comprehensive attack to date on the hostile bid for their company, which was launched last month by rival Harmony.
This week should also see the outcome of some of the legal challenges that have been launched by Gold Fields before the Securities Regulation Panel, the Competition Tribunal and the High Court.
After announcing its offer, Harmony sent an offer document to Gold Fields shareholders in the US, who hold altogether about 24% of the group.
This week will be the turn of Gold Fields, whose lawyers and advisers have been working virtually nonstop to compile the `defence document`.
This is expected to contain the Gold Fields board`s considered opinion on the Harmony offer, as well as advice to shareholders to reject the offer.
In justifying its offer, Harmony has suggested that it could make major cost savings at Gold Fields, and it has also attacked the latter`s plan to reverse list its non-Southern African Development Community assets into Canada`s IAMGOLD.
On Thursday, when Gold Fields executives announced their financial results for the quarter to September, they took the unusual step of holding a presentation of the quarterlies, and also compiled a series of comparative figures designed to prove that Harmony is an inferior competitor.
Similar arguments are expected to figure in the offer document, which is due to be made public by Wednesday at the latest.
In this way Gold Fields executives hope they will be able to persuade their own shareholders to turn down the Harmony offer.
Meanwhile, Gold Fields will be pursuing its legal challenges to the deal before various regulatory authorities.
It will be arguing before the high court that Harmony`s offer to Gold Fields shareholders, which is worth in the region of R50bn, was illegal, as the offer would involve the issuing of new shares, but was not accompanied by a prospectus.
Harmony CE Bernard Swanepoel dismissed this argument yesterday.
`If their interpretation is that the offer is unlawful, then the formation of Gold Fields was also unlawful. That`s how they created Gold Fields.`
He said Gold Fields was using a variety of challenges to prevent its shareholders from voting on the deal: `While they have been wasting time with legal matters, we have had two weeks to talk to shareholders.
`There is huge support among Harmony shareholders, and where there is an overlap (with people also holding Gold Fields shares) those shareholders are strongly in favour.`
Harmony said on Friday that Institutional Shareholder Services, the world`s leading provider of proxy voting and corporate governance services, had voiced its support for the offer.
`(Its) backing is an important step in moving forward with this merger, as it provides a credible, independent endorsement that this transaction is in the best interest of all shareholders.`
