Australia’s investment house Allan Gray is disputing the legitimacy of the decision-making process in the merger between Roc Oil and Horizon Oil, calling for an extraordinary general meeting.
The firm called on its 5% voting power to call for a meeting to change the terms of the deal so Roc shareholders have a say in the final decision.
Allan Gray managing director Simon Marais said the deal leaves Roc with less than Horizon in a letter to shareholder.
“It is inappropriate for Horizon shareholders to determine the future for Roc shareholders because the merger will have a profound effect on our collective interests in Roc,” he said.
Marais called the EGM under section 249D of the Corporations Act to make Roc shareholders votes heard on the deal.
“Our request for the meeting is not about arguing the merits or otherwise of the merger, rather it is about giving Roc shareholders a voice and asking for the Roc constitution to be changed so that if Roc is issuing more than 30% of its share capital, Roc directors must first obtain shareholder approval.
“If 75% of the shareholders vote for this amendment at the EGM, Roc would then need to hold a meeting to determine if it should issue shares to Horizon.”
Roc is required to call a meeting in the next 21 days.
The proposed deal has been said to give power largely to Horizon shareholders and would leave Horizon boss Brent Emmett in charge of the merged entity.
Allan Gray has encouraged fellow shareholders to vote in favour of the proposal.
In a joint press release, Roc and Horizon said the proposed merger was backed by the boards of both companies.
The companies together hold proven plus probable reserves of 36.9 million barrels of oil equivalent and best estimate contingent resources of 120.7 million boe across assets in China, Papua New Guinea, Malaysia, Myanmar, Australia and New Zealand.