Aussie Broadband shares down while Superloop gains as telcos go to court
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More news: Shares in Aussie Broadband fell after the telco announced it had commenced court proceedings in the Federal Court of Australia against ASX rival Superloop.
Aussie Broadband shares were down 2.3% to $3.49 by 12:05pm AEDT.
Meanwhile, Superloop shares lifted on the news, gaining 1.7% to $2.10.
Aussie Broadband takes Superloop to court over stock buy
The news: Aussie Broadband has commenced proceedings in the Federal Court of Australia against Superloop, in a bid to maintain its 19.9% shareholding in its telco rival.
The numbers: On Monday, Aussie Broadband said that it was told to reduce its shareholding in Superloop, after failing to seek the relevant regulatory approvals before acquiring a 19.9% stake in the company last month.
Superloop instructed Aussie Broadband to sell 37.6 million shares, to bring its total shareholding to below 12%, within 10 business days. Under Superloop's constitution, a person or company must not control between 12% and 30% of the voting power, without prior written approval of the Info-communications Media Development Authority of Singapore (IMDA).
The context: After market close on Monday, Aussie Broadband filed an “urgent” request in the Federal Court against its rival and each of its directors for permanent and interlocutory injunctions to set aside Superloop’s notice. It also submitted an application to the IMDA to obtain approval for the acquisition of the excess shares.
Aussie Broadband claimed its failure to comply with Superloop's constitution was "inadvertent". However, Superloop said that Aussie Broadband's legal advisers "sought to characterise" the breach as "inadvertent", despite its recent acquisition of Symbio requiring IMDA approval under the same statutory regime.
The latest part of the ongoing saga between the two ASX-listed telcos follows Superloop rejecting Aussie Broadband's $466 million takeover approach in February, and Superloop abruptly replacing Aussie Broadband as Origin Energy's wholesale internet services provider last week.
The source: ASX announcement
