MGX Holdings has rejected a ruling by the Securities Regulation Panel (SRP) with regard to its acquisition of EC-Hold, and says it will contest it.
The SRP`s executive committee has ruled that the Mandy Rebecca Price Trust and MGX, as concert parties, concluded an affected transaction by acquiring EC-Hold shares before the announcement of MGX`s firm intention to make an offer to EC-Hold minority shareholders.
The enforcement of the ruling is at the discretion of the High Court.
EC-Hold shareholders lodged a complaint with the SRP after the announcement of the acquisition of EC-Hold.
"MGX has at all times denied the complaints laid by the complainants and it continues to do so," MGX says in a statement released this morning.
"It accordingly does not accept the ruling and will contest it with full vigour through all channels available to it."
The group says that it believes the worst-case contingent exposure of MGX, based on current information, would be to increase the capital cost of its offer for EC-Hold shares by about R45 million.
The EC-Hold share rocketed on the news, rising more than 36%, or 40c, to trade at 150c by mid-morning. The MGX share was trading 30c or 2.94% higher at R10.50.
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