PM Transcripts

FOR PRESS: P. M. No. 3/ 1969
OVERSEAS TAKEOVERS CF AUSTRALIAN COMPANIES
joint Statement by the Prime Minister and the Treasurer
In a discussion we had with Mr. C. T. Looker, President
of the Australian Associated Stock Exchanges, on 5 December last, we
informed him of the view held by the Government that the shareholders
of an Australian company should have a right to amend its Articles of
Association for the purpose of ensuring that control of the company,
exercised through the voting powers of the shareholders, remains in
Australian hands. In effect, we considered that the directors and
shareholders of Australian companies should be placed in a position from
which they could, if necessary, protect the company from outside
manoeuvres in the market or elsewhere to gain control of the company.
Mr. Looker undertook to discuss with members of the
Associated Stock Exchanges the question of amiending the provisions of
the present listing requirements of the Australian Stock Exchanges under
which a company is not admitted to the Stock Exchange unless the Company' s
Articles provide for equal voting rights for all shareholders of one class.
Mr. Looker has now informed us of the outcome of the
discussions between himself and his colleagues.
They have put to us strongly their view that the most
satisfactory form of protection for Australian companies against various
undesirable types of take-over operations is to be sought by amending
in certain respects those sections of the uniform Companies Acts which
relate to the take-over codes. At the invitation of the Attorney -Genera I
they will themselves makle detailed submissions on this matter to the
Eggleston Committee which will advise the Standing Committee of
Commonwealth and State Attorneys General.
The Stock Exchanges will accede to the Government's
request for the revision of the listing requirements to permit the quotation
of shares of the one class having different voting rights. They would have
preferred the postponement of this action until decisions had been taken on
amendments of the uniform Companies Act but they appreciated that it. could
take considerable time to make the necessary legislative changes in
Commonwealth and State laws.
In agreeing to this revision the Exchanges emphasised that
such action must not impair the free transferability of shares. The question
of who owns shares as distinct from the exercises of voting rights is not
involved. They also feel that the revised listing requirements should
ensure that an alteration to a Company's Articles to permit of qualified
voting rights should be subject to approval being given by a simple majority
in value of the shareholders of the company. The present approval of
per cent of the shareholders present and voting at a meeting does not,
in their view, necessarily represent a majority decision of all shareholders.
The Stock Exchanges will be making a submission along these lines to the
Eggleston Committee. The Government appreciates the approach of the Australian
Associated Stock Exchanges to a problem which it feels is both urgent and
important.
CANBERRA 5 January 196 9