Panel application in relation to Ashton mining [02/10/2000] The Takeovers Panel

Monday, 2 October 2000

PANEL application in relation to Ashton mining

The Takeovers Panel advises that it has received an application by De Beers Australia Holdings Pty Ltd for a declaration of unacceptable circumstances in relation to the affairs of Ashton Mining Limited.

De Beers has applied for an interim order under section 657E of the Corporations Law to restrain Rio Tinto from dispatching its bidder's statement to Ashton shareholders until it is amended.

De Beers alleges that the following circumstances constitute unacceptable circumstances in relation to the affairs of Ashton:

  1. Rio Tinto included misleading or deceptive statements in its bidder's statement (and supplementary bidder's statement) concerning De Beers' proposals for replacement marketing arrangements in relation to the Argyle Diamond Mine, and the likely impact of those replacement marketing arrangements on Rio Tinto, the Western Australian Diamond Trust, the State of Western Australia, the market for Argyle diamonds generally and Ashton's interest in Argyle;
  2. Rio Tinto failed to include in its bidder's statement information required under section 636(1)(m) of the Corporations Law in relation to:
  1. the price per carat obtained by the Argyle Joint Venture for Argyle diamonds;
  2. the capital expenditure required of Ashton for underground development of Argyle and the production potential of such development; and
  3. the probability of the underground development proceeding and the expected mine life for Argyle; and
  1. Rio Tinto included in its bidder's statement a statement said to be based on a view expressed by the Western Australian Department of Resources Development without stating that consent has been given as required by section 636(3) of the Corporations Law.

De Beers alleges that an interim order restraining dispatch of Rio Tinto's bidder's statement is necessary, inter alia, to prevent Ashton shareholders being misled and deprived of information which may lead them to form views or make decisions regarding the competing bids for Ashton which are not fully informed.

The President of the Panel Mr Simon McKeon is currently assembling the Panel members to sit on this application.

George Durbridge
Counsel , Corporations and Securities Panel
Level 47 Nauru House 80 Collins Street (03) 9655 3553
george.durbridge@takeovers.gov.au