Derek Achong

derek.achong@guardian.co.tt

Readymix (West In­dies) Ltd mi­nor­i­ty share­hold­er Pe­ter Per­me­ll has won his le­gal chal­lenge over the share price of­fered by Trinidad Ce­ment Lim­it­ed (TCL) when it ac­quired a ma­jor­i­ty stake in the com­pa­ny in 2017. 

De­liv­er­ing a judge­ment at the Hall of Jus­tice in Port-of-Spain, yes­ter­day morn­ing, High Court Judge, Eleanor Don­ald­son-Hon­ey­well, ruled that the fair mar­ket val­ue of the shares was $13.42 as op­posed to the $11 or US$1.62 orig­i­nal­ly of­fered by TCL. 

The share price set by Don­ald­son-Hon­ey­well on­ly ap­plies to the 26,400 shares owned by Per­me­ll as he was the on­ly mi­nor­i­ty share­hold­er who opt­ed to chal­lenge TCL’s of­fer. 

Ac­cord­ing to the ev­i­dence in the case, when TCL be­gan the take over in March 2017, it held 8,531,977 shares or a 71.1 per cent stake in the com­pa­ny. 

Fifty-three of the com­pa­ny’s 496 mi­nor­i­ty share­hold­ers in­clud­ing Cli­co, RBC Trust, Unit Trust Cor­po­ra­tion (UTC) and Re­pub­lic Bank Lim­it­ed took up TCL’s of­fer. 

Fol­low­ing the close of the bid, 39 oth­er mi­nor­i­ty share­hold­ers of­fered a fur­ther 1,577,207 shares, leav­ing TCL with over 90 per cent share of the com­pa­ny. 

Un­der the T&T Se­cu­ri­ties and Ex­change Com­mis­sion Take-Over By-Laws, the com­pa­ny was re­quired to of­fer to buy-out the re­main­ing share­hold­ers in­clud­ing Per­me­ll, who lat­er de­cid­ed to chal­lenge the share price of­fered by TCL. 

At a pre­lim­i­nary stage in the case, the par­ties had le­gal ar­gu­ments on which of them should be re­quired to pay for an in­de­pen­dent val­u­a­tion of the com­pa­ny re­quired to de­ter­mine the fair mar­ket val­ue of the shares. 

Don­ald­son-Hon­ey­well even­tu­al­ly or­dered that TCL foot the bill. 

Don­ald­son-Hon­ey­well’s as­sess­ment of the fair mar­ket price of the shares was based sole­ly on the in­de­pen­dent val­u­a­tion the court even­tu­al­ly re­ceived. 

As a sec­ondary is­sue in the case, Per­me­ll was ask­ing the court to or­der in­ter­est to be paid on the val­u­a­tion, which took ef­fect from the date of the fil­ing of the law­suit. 

As Don­ald­son-Hon­ey­well dis­agreed with the con­tention, she on­ly or­dered TCL to pay 75 per cent of Per­me­ll’s le­gal costs for bring­ing the law­suit. 

In a brief in­ter­view af­ter the judge­ment was de­liv­ered, Per­me­ll said he was pleased as the case set a le­gal prece­dent for lo­cal and re­gion­al merg­ers and ac­qui­si­tions. 

He claimed that TCL had ini­tial­ly at­tempt­ed to set­tle the case but he de­cid­ed to take it to tri­al for there to be a ju­di­cial de­ter­mi­na­tion on the is­sue. 

“I re­al­ly did this be­cause the ju­rispru­dence in the area is scarce...This is a small vic­to­ry for me but a large one for mi­nor­i­ty share­hold­ers not just here but for the whole Caribbean,” Per­me­ll said. 

Per­me­ll was rep­re­sent­ed by Ron­nie Bisses­sar and Varin Gopaul-Go­sine, while Cather­ine Ram­nar­ine and Miguel Vasquez rep­re­sent­ed TCL.