Application for Review of Decision in Relation to Pinnacle 5 [30/05/2001] The Takeovers Panel

Wednesday 30 May 2001

APPLICATION FOR REVIEW OF DECISION IN RELATION TO PINNACLE 5

The Panel advises that it has received an application by Reliable power Inc for review of a decision by the Pinnacle 5 Panel.

The Pinnacle 5 Panel considered an application brought by Reliable in relation to Reliable's off market cash takeover bid for Pinnacle VRB Limited and the announcement by Pinnacle on 29 March 2001, that it has granted a licence to Vanteck (VRB) Technology Corp to market, sell, manufacture and utilise Pinnacle's Vanadium Redox Battery technology within Canada, the United States, Central and South America (the Vanteck Transaction).

On 23 May, 2001, the Pinnacle 5 Panel decided not to make a declaration or orders in relation to the Vanteck Transaction. It made a similar decision in relation to a further transaction announced on 11 April 2001, that Pinnacle has granted Int-A-Grid (UK) Ltd similar, sole and exclusive licence for the territories of Europe, Russia and the Middle East (the Int-A-Grid Transaction).

The Pinnacle 5 Panel decided that because the Transactions were entered into after the announcement of Reliable's Bid and may trigger a defeating condition in the Bid, they may have the effect of depriving Pinnacle shareholders of access to benefits which they might have received under Reliable's Bid. For this reason, the Panel decided that the Transactions should be subject to approval by Pinnacle's shareholders.

The Pinnacle 5 Panel decided to make no declaration or orders because:

· Pinnacle decided to convene a general meeting to seek shareholder ratification of the Vanteck and Int-A-Grid Transactions; and

· The sitting Panel in this matter did not want to impose a principle retrospectively on Pinnacle that had not been explicit at the time that Pinnacle's directors decided to enter into the Transactions.

The President of the Panel, Mr Simon McKeon, has appointed the following sitting Panel in this matter Justice Kim Santow (sitting President), Denis Byrne (sitting Deputy President) and Trevor Rowe.

Nigel Morris
Director, Corporations and Securities Panel
Level 47 Nauru House, 80 Collins Street, Melbourne VIC 3000
Ph: +61 3 9655 3501
nigel.morris@takeovers.gov.au