The High Court has ordered the attachment of 200 million Trustco Group Holdings shares and 1 135 unlisted Legal Shield Holdings shares linked to US-based Riskowitz Value Fund LP (RVF), temporarily preventing the investor from selling or transferring the shares.
The interim order was granted on 25 September in a legal dispute between Trustco and RVF, as the two parties remain locked in a battle over the future control of the Namibian investment group.
According to Trustco, the attachment places the shares under the control of the court while the order remains in force.
The company says RVF is therefore unable to sell, transfer or otherwise deal with the attached shares.
Trustco spokesperson Neville Basson says the company views the court order as an important step in the dispute over the shares and RVF’s attempts to influence the company’s board.
The dispute is linked to a N$468 million transaction approved by Trustco shareholders, under which Trustco agreed to acquire a further 11.35% stake in Legal Shield Holdings from RVF in exchange for Trustco shares.
The transaction involves the issue of 400 million Trustco shares at N$1.17 each, but shareholder approval was subject to the transaction not resulting in a change of control of Trustco.
Battle over the board
The dispute escalated after RVF sought changes to Trustco’s board.
Trustco says the Riskowitz group made unsuccessful attempts to change the board in February and August this year.
RVF has since demanded another shareholders’ meeting to consider the appointment of a new board.
Trustco confirmed receiving that demand on 25 September and said it is assessing its content and validity.
Trustco Group CEO Quinton van Rooyen says, “No foreign actor or shareholder will take control of Trustco in a hostile manner or by an abuse of process.”
Van Rooyen says shareholders with at least 5% of voting rights can legally request a general meeting, but must comply with the requirements of the Companies Act.
“The right to requisition a meeting does not excuse non-compliance with the law,” he says.
Trustco has also pointed to a non-binding advisory opinion from the Namibian Competition Commission dated 29 July.
Competition concerns
According to Trustco, the commission indicated that an arrangement allowing RVF to appoint or remove a majority of Trustco’s directors would require merger notification and approval before it could be implemented.
Trustco has previously said it is unwinding the Legal Shield transaction after concluding that RVF’s actions were inconsistent with the conditions under which shareholders approved the deal.
