Ascendis takeover by management consortium is being defended

Ascendis Health. Photo: Supplied

Ascendis Health. Photo: Supplied

Published Jan 22, 2024

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Ascendis Health, on the verge of another controversial shareholder buyout, this time by a consortium led by CEO Carl Neethling, on Friday resorted to official JSE notice to refute information carried on the “X” social media platform.

This followed a week during which a key misrepresentation on the circular to shareholders brought a postponement to the shareholders meeting to vote on the buyout and possible delisting.

Listed company directors typically do not comment on views on the company carried on social media, but the use of “X” by a growing number of active retail shareholders in South Africa has seen more JSE companies having to put out official announcements, to counter certain information published on social media.

Ascendis had a shareholders meeting scheduled for last Thursday to approve the buyout, but this was postponed only a day prior after the Takeover Regulation Panel (TRP) said the circular to shareholders was incorrect.

The TRP had intervened working on information supplied to it by Harry Smit, shareholder activist and Ascendis’ former chairman, who was working on behalf of certain shareholders.

Smit had himself previously led a group of disgruntled shareholders in overturning Ascendis’ management two years ago, and restored the company back to relative health through a restructuring and cutting the debt.

“This postponement gives us some time, as they will need to put out a new circular before scheduling the next shareholding meeting,” Smit said in a telephone interview.

He said that he, on behalf of shareholders, had laid complaints with the TRP and JSE about the Ascendis’ management and the buyout offer, and they were waiting for these responses. In addition, “next weekend” he intended to lay criminal charges with the Commercial Crime unit.

He said Neethling had made a 95 cents a share offer when he was first appointed to Ascendis two years ago, which shareholders had rejected, so how then could he now put in a lower 80 cents offer, especially considering the company was in much better shape than two years ago, and the directors themselves had valued the shares at about R1.55 each.

Ascendis said on Friday: “The Independent Board can confirm that the X Presentation is not a Company document, has never been presented to the Ascendis board, nor has it been sanctioned by the Ascendis board. The Independent Board also confirms that the X Presentation contains numerous factual inaccuracies and does not reflect the reality of the Ascendis group.”

Business Report on Friday was unfortunately unable to source the relevant information on “X” - the post may have been taken down.

Asecendis said the reason for cancelling the meeting was there was a “bona fide error” in the circular, after attention was drawn to the omission by the TRP acting upon a complaint.

An indirect shareholding in Ascendis held by JVDM, a member of the buyout consortium, had not been disclosed in the circular, Ascendis’ board said.

BUSINESS REPORT