Fiji: Stock market has stopped the South Pacific Distilleries merger with Carlton Brewery

The Capital Markets Development Authority has stopped the South Pacific Distilleries merger with Carlton Brewery of Fiji after two pages of a report on the independent report by KPMG was missing from information given to shareholders, Nationwide News posted on May 5.

South Pacific Stock Exchange chief executive Sanjay Sharma confirmed in a release which did not contain the reasons for CMDA's action.

SPD company secretary Alfred Chan said the statement by Mr Sharma should have said that "until the defect is remedied to satisfaction, CMDA does not in terms of section 48 (1) of the CMDA Act, allow to become an effective proposal to proceed with the transaction".

The defect, he said, referred to an "inadvertent" omission of two pages from the KPMG report for the information of minority shareholders of SPD. "This was because of a printing error, which was not noticed until this week.

"While the directors of SPD regret the inadvertent omission, the directors have determined that the information contained in the missing sections is immaterial or included elsewhere in the report.

"They do not believe the omission will affect shareholders. Further, SPD has taken a number of steps to rectify the defect including posting a copy of the pages directly to shareholders with an explanatory note. "In addition, we note that the full copy of the report was available on the SPSE website since the release of the notice of extraordinary meeting," Mr Chan said.

The missing pages were the valuation of Samoa Breweries Limited and its expected performance this year.

KPMG reported that while SBL had a strong market position, it was small compared to Australian companies and its substantial market share was a constraint on domestic growth and that it operated in a small developing country. Meanwhile, Mr Chan said the issue was still under consideration by the CMDA, with whom SPD was still in discussion. "CMDA is expected to notify SPD today if it has taken action to rectify the defect."

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