JSE-listed printing and packaging firm Novus has won a High Court appeal against the Takeover Regulation Panel (TRP), which had dealt the company a blow in its bid to acquire ICT distributor Mustek.
The deal faced scrutiny after the TRP recently determined that Mustek shareholder, the DK Trust, acted as a “concert party” in Novus’s bid to acquire Mustek.
The TRP determined that Novus acted “in concert” with the DK Trust in structuring the transaction, and this potentially put smaller Mustek shareholders at a disadvantage.
It then unilaterally withdrew its approval of the transaction before directing Novus to publish a revised firm intention announcement within 20 business days of the ruling.
Novus then approached the courts to challenge the TRP ruling.
The TRP is established in terms of section 196 of the Companies Act 71 of 2008 as a juristic person. The panel reports to the minister of trade, industry and competition, and functions as an organ of State within the public administration, but as an institution outside the public service.
In a statement yesterday, Novus says: “We refer to our SENS announcement dated 28 March 2025, wherein Novus advised that the TRP had provided a ruling to Novus on 27 March 2025 in terms of which the TRP had unilaterally withdrawn its approval of its firm intention announcement dated 15 November 2024 on grounds with which Novus strongly disagreed and directed Novus to publish a revised firm intention announcement; and Novus intended to appeal against the ruling on an urgent basis, on the grounds that it was improper.”
According to Novus, the appeal was heard in the High Court on Friday, 25 April.
On 26 April, an order was granted by the High Court declaring the ruling unlawful, unconstitutional and set aside, it adds.
The TRP was ordered to pay the cost of the application, including the cost of two counsel.
Novus says it will be engaging with the panel to publish its circular to Mustek shareholders as soon as possible, as directed by the order of the High Court.
The panel stated it is evaluating the High Court’s decision and how it affects its regulatory authority.
However, it also confirmed it will take the necessary next steps to avoid delaying the transaction or allegations of contempt of court while fully reserving the right to reconsider the issue once the court shares its reasoning for its decision with the involved parties.
The TRP snag came after the Competition Commission and Competition Tribunal both gave the green light for the deal to proceed.
In November, Novus made an offer to buy Mustek and told Mustek shareholders that it had acquired the beneficial ownership of ordinary issued shares in Mustek, which resulted in Novus beneficially holding 35% or more of all the issued Mustek shares.
Accordingly, Novus proceeded to make a mandatory offer, as required in terms of section 123 of the Companies Act, to acquire all of the Mustek shares not already beneficially held by Novus, or any of its related and concert parties.
Under the deal, Novus offered a cash consideration of R13 for each Mustek share, a cash amount of R7 plus one ordinary share in Novus for each Mustek share and two Novus shares for each Mustek share tendered by a mandatory offer participant.
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