Panel hands down The Market Herald orders

A former director of Perth-based media firm The Market Herald has been ordered to hand over some of his shares to the corporate regulator and pay costs to the company’s former managing director.

The Takeovers Panel made final orders today in relation to an earlier finding of unacceptable circumstances around two entitlement offers by the ASX-listed company, which it said lacked disclosure regarding the association of some shareholders.

The investigation found that substantial shareholder David Argyle and his son Gavin Argyle – also a substantial shareholder and a company director – “became associated for the purpose of controlling or influencing the composition of TMH’s board or the conduct of its affairs”.

The orders include a requirement that Jag Sanger, who quit as managing director last year following an attempt by the board to oust him, be paid a combined $65,000 by The Market Herald and Gavin Argyle within 30 days to cover his costs relating to the panel’s proceedings and a proportion of residual costs.

TMH and Gavin Argyle have also been ordered to pay a combined $80,000 to substantial shareholder UIL, which applied for the review into the company by the Takeover Panel. UIL is understood to be a vehicle of investor Duncan Saville.

The panel also ordered that 1,974,019 shares held by Gavin Argyle through GAB Superannuation Fund Pty Ltd be vested in the Commonwealth for the Australian Securities and Investments Commission to sell. The shares are worth an estimated $640,000.

This incorporates the number of TMH shares placed to Kasey Linney and Eric Rosenal – employees of an entity controlled by Gavin Argyle – and the number of TMH shares which GAB became entitled to under an entitlement offer in 2023 as a result of its acquisition of 550,000 TMH shares in October last year.

The October acquisition came two days after Mr Rosenal sold the same number of shares on market.

A further 87,324 shares held by David Argyle directly or through Zero Nominees will also be vested to ASIC for sale, representing the number of shares he became entitled to under the 2023 entitlement offer as a result of his acquisition of 523,994 TMH shares on the same day in October last year.

David and Gavin Argyle, TMH non-executive chairman Alec Pismiris, Ms Linney and Mr Rosenal have each been ordered to disclose their association with each other in the matter.

Those deemed to be relevant parties have been ordered not to exercise any TMH voting rights acquired since their association with other parties involved began.

They will be barred for 12 months from acquiring further TMH shares without prior consent of the panel, except in the case of a pro rata entitlement offer to all shareholders.

In addition, the Market Herald has been directed to appoint two independent directors to its board, including one as chair, in consultation with an independent consultant.

The Takeover Panel’s orders come after it found shareholders in The Market Herald were not informed of the aggregate relevant interest in shares held by the associated parties, or the various arrangements between them.

The panel earlier highlighted booklets for two entitlement offers that it said contravened the substantial holder provisions by not disclosing an association between the Argyles.

The first entitlement offer specifically stated that the Argyles were not considered associates and, as such, their shareholdings were not aggregated.

The Market Herald issued an ASX statement acknowledging the orders, and said it was awaiting approval from the Takeovers Panel for a further announcement explaining the panel’s decision.  

TMH shares were 1.5 per cent lower at close of market today.