Australian regulator tells certain former Molopo directors to repay legal costs
The Australian Takeovers regulator is ordering certain former directors of Molopo Energy to repay legal costs incurred by the company.
Molopo is struggling to contain the fallout from a deal it went into last year without the ASX’s or shareholders’ approval.
Earlier this year, the ASX referred the company to ASIC over alleged lapses in disclosure around the $47 million “Orient Transaction”.
The Takeovers Panel originally ordered Molopo to pay shareholder Aurora Funds compensation to cover the costs of its takeover bid as well as its legal costs.
A review panel has now issued further orders that certain former directors reimburse Molopo for the costs it was ordered to pay Aurora Funds and the legal costs incurred by Molopo and major shareholder Keybridge.
“The review panel found, among other things, that the former directors blatantly disregarded Molopo’s disclosure obligations on numerous occasions, at times over extended periods, and were directly responsible for the actions taken, or purportedly taken, by or on behalf of Molopo giving rise to the unacceptable circumstances,” the regulator said in a statement released on the ASX late yesterday.
The Panel said that it doesn’t often make orders against directors personally, but that it considered it appropriate to do so in this case.
“The Panel does not make such orders to punish, but rather because it thinks such orders are appropriate to protect the rights or interests of persons affected by the unacceptable
circumstances,” it said.
The regulator argued that its orders would protect the interests of Molopo shareholders who have been affected by “seriously deficient disclosure” that resulted in the deals with Aurora Funds and Keybridge not going ahead.