Last checked at 1 Mar 2019 10:42
AFARAK RECEIVES DECISION FROM THE ADMINISTRATIVE COURT OF HELSINKI
10:45 London, 12:45 Helsinki, March 1, 2019 - Afarak Group Plc ("Afarak" or "the Company")
AFARAK RECEIVES DECISION FROM THE ADMINISTRATIVE COURT OF HELSINKI
It has come to the attention of Afarak Group Plc, that the Administrative Court of Helsinki has today made a decision on the matter that is related to the decision rendered by FIN-FSA on October 7, 2018. This decision was related to Mr. Danko Koncar and according to the decision he was obliged to make a public tender on all shares of Afarak Group Plc.
The Financial Supervisory Authority had obliged Koncar to publish a mandatory takeover bid for Afarak Group Plc's shares and securities issued by the company pursuant to Chapter 6, Section 10 of the Securities Markets Act 1989 (repealed as of 1 January 2013), to initiate a tender offer procedure and to execute the takeover bid. In order to enhance the effectiveness of the obligations, the Financial Supervision Authority had imposed a periodic penalty payment of EUR 40,000,000 for each obligation and EUR 10,000,000 for each additional full month of non-compliance.
As stated in the release on October 7, 2018, Danko Koncar has informed the Company that he has already appealed to the decision. In its judgment today, the Helsinki Administrative Court has rejected Danko Koncar's request to reverse the Financial Supervisory Authority's decision requiring Koncar to make a public bid for the shares in Afarak Group Plc.
In its decision, the Administrative Court found that Kermas Ltd, which owns shares in Afarak Group Plc, had been controlled by Koncar in 2009 and that Koncar was therefore deemed to be a shareholder of Afarak Group Plc. Koncar was considered to have been acting in concert with Hino Resources Co. Ltd, Finaline Business Limited, and therefore he and his wife, Jelena Manojlovic, were in a position to exercise dominance over Afarak Group Plc.
When Kermas Ltd and Hino Resources Co. Ltd's share of the votes in Afarak Group Plc's shares had exceeded the mandatory bid limit of 30% on October 22, 2009, the offer obligation was deemed to have arisen at that time.
The Administrative Court took the view that Koncar was the party that needs to make the offer. Consequently, the Financial Supervisory Authority has been authorised to oblige the appellant to fulfill the obligations imposed by the threat of fines.
In addition, by its judgment delivered today, the Administrative Court rejected Koncar's request to annul the Financial Supervisory Authority's subsequent decision to order Koncar to pay a fine of EUR 40,000,000 as the principal obligation imposed by the imposition of a penalty payment was not respected. However, the Administrative Court held that the additional amount of the fine of EUR 10,000,000 had not yet accrued at the time of the contested decision and annulled the FSA's decision on the additional tranche.
The Company is not a party to the proceedings and/or the judgement. The Company was also informed that Dr Koncar will immediately appeal against the decision of the Helsinki Administrative Court in front of the Supreme Administrative Court of Finland. The Company will provide the full decision(s) and translations thereto at later stage.
The Board of DirectorsAfarak Group
For additional information, please contact:
Guy Konsbruck, CEO, +356 2122 1566, guy.konsbruck@afarak.comJean Paul Fabri, PR Manager, +356 2122 1566, jp.fabri@afarak.com
Financial reports and other investor information are available on the Company's website: www.afarak.com.
Afarak Group is a specialist alloy producer focused on delivering sustainable growth with a Speciality Alloys business in southern Europe and a FerroAlloys business in South Africa. The Company is listed on NASDAQ Helsinki (AFAGR) and the Main Market of the London Stock Exchange (AFRK).
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www.afarak.com