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The Agency (ASX: AU1) has asked the Takeovers Panel to force potential hostile bidder and major shareholder Magnolia to "show us the money" if it plans to make an unsolicited bid for the real estate group.
The Agency, which is also keen to find out how Magnolia plans to pay out the remainder of its debt facility to Macquarie Bank, has sought the panel to prohibit Magnolia from proceeding with the takeover until it provides funding evidence.
The request is an escalation of the spat between The Agency board and Magnolia director Mitchell Atkins.
It has also revealed the identity of the person who ultimately controls Magnolia, Camilla Overgarrd, who The Agency says should already have been registered with the ASX as a substantial shareholder of the company.
"As ultimate controller of Magnolia's stake in AU1, Ms Camilla Overgaard ought to have filed a substantial shareholder notice in May 2020 at the time she acquired all the issued shares in the ultimate controller of Magnolia (MC Investments (Aus) Pty Ltd) and has not done so," says The Agency.
Atkins, Magnolia and entities associated with Magnolia have voting power of 16.65 per cent in The Agency. Overgaard is understood to be Atkins wife.
The company revealed yesterday that it had received a letter from Magnolia Equities III Pty Ltd last Friday alerting it to its plans for an unsolicited and conditional offer for all the shares in the company.
The move followed the departure of Atkins from The Agency's board in May, some 10 months after Magnolia Capital injected $5.6 million into the real estate group through a placement and entitlement offer.
The timing of the offer by Magnolia is right in the lead-up to 31 December, the most recent deadline for the company's primary bank debt owed to Macquarie Bank. The debt was originally due in March this year.
Magnolia says its offer will provide an alternative to the planned issue of $5 million in convertible notes to Peters Investments Pty Ltd that will help the company repay its debt facility. Peters Investments is a private investment company owned by horse breeder Bob Peters.
The Agency says that as it is an alternative to the notes issue, Magnolia must provide its shareholders with sufficient information about the bid, especially the source and availability of funding.
The Agency shareholders will vote on the notes issue at the AGM scheduled for December 23.
Magnolia has indicated that a defeating condition for its bid includes that none of the proposed resolutions relating to the Peters notes issue is moved or passed at the AGM.
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