Dairy and beef processor Beston Global Food Company’s $15.6m capital raising, intended to pay for an upgrade of the company’s lactoferrin production plant, has been challenged by minority stakeholders. Beston has been referred to the Australian Government’s Takeover Panel by Kunteng Limited, who suggested the capital raising was Beston’s attempt at diluting the Chinese stakeholder’s influence.
Kunteng Limited and Dashang Group owning 10.6% and 9%, respectively have both sought to put their own candidates on Beston’s board. However, in the case of Kunteng Beston advised shareholders to vote against the board appointment, stating lack of police checks and due diligence of Kunteng’s board appointee was an attempt to circumvent the company’s normal due diligence process. According to Beston, the company’s Chinese investors did not seem to be co-operating in the best interests of the business.
Beston Food’s chief executive officer Jonathan Hicks said it appeared Chinese investors are voting differently to other shareholders, with a contingent resolution to spill all directors if at least 25% of shareholder vote against adaptation of the company’s remuneration report appearing on the meeting notice papers for the year. Hicks said those agitating for a spill motion had no alternative strategies and said their actions had the capacity to change control of the company without a formal takeover being made.