Lion sells Montana's shares

The Australasian brewer Lion Nathan has failed in its last-ditch legal challenge to try to stall a New Zealand Stock Exchange ruling requiring it to sell 19 per cent of its holding in winemaker Montana Group by August 17, reports the Financial Times. Lion Nathan is currently locked in a NZ$1bn (Euro477.318m) battle with the British spirits company Allied Domecq. According to the ruling, Lion will see its controlling 63 per cent reduced to 44 per cent as a penalty for a buying misdemeanour in February 2001. On August 13, Lion said that it accepted the decision taken in the New Zealand High Court, and would begin to sell the shares. Allied, which currently holds 27 per cent, would appear to be the logical buyer as it has a bid in the market at NZ$4.80 (Euro2.29) a share. However Lion, which has fought tenaciously against Allied for six months, is seen as likely to do all it can to stop the shares being sold to its rival. Lion is not precluded from making a new offer. Allied welcomed the decision made in the Auckland High Court. Jane Mussared of Allied said the company would wait to see what would happen next. "Lion should sell to us as we have a full and fair offer for Montana in the market,"​ she added. Most analysts believe Lion will regain control. It needs to buy only seven per cent of the 19 per cent it is being forced to sell, to be comfortably over the 51 per cent mark, one said. With an average price of NZ$3.80 (Euro1.81) a share, it could possibly pay more than Allied. Lion had asked the court on Friday to give it more time to sell the shares so that it could pursue a judicial review of the stock exchange ruling which Lion said defied the laws of natural justice. Judge Noel Anderson said the High Court did not have the jurisdiction to extend the period during which Lion must sell the shares, and that the terms of the stock exchange listing rules allowed for dispute resolutions within the exchange itself.