Phosphate miner and suitor may forge deeper relationship

Christmas Island phosphate miner Phosphate Resources Limited could soon become a listed company thanks to improved relations with its takeover suitor Asset Backed Holdings.

That would bring a company with annual revenues of $50 million to the market through the Australian Stock Exchange-listed ABH.

PRL, a public unlisted company, became embroiled in a hostile takeover battle launched by ABH last August. Relations between the two companies improved in December when ABH directors David Argyle and Susmit Shah left the board in favour of David Lymburn and Malaysian businessman Kim Sun Oh.

Mr Oh was a former group executive director of the Chemical Company of Malaysia, one of PRL’s largest customers.

However, the most telling change was PRL secretary Peter Torre replacing Susmit Shah as ABH’s company secretary on January 12.

Mr Torre said there was a real possibility the two companies could merge, creating an ASX-listed mining company.

But that was just one of the options before the two companies, he said.

“The board of PRL has to recognise the fact that the market for its shares is virtually non-existent and that at some stage our shareholders will want to sell out and being a listed company will give them that opportunity,” Mr Torre said.

He said ABH would also likely be given an opportunity to place a director on PRL’s board.

ABH chairman Mark Caruso said with its takeover push stagnating, ABH had been left with two options, either to sell its 42 per cent stake in PRL or find another way to move forward.

“We had a takeover and that wasn’t successful. We have to look at moving forward in some kind of synergistic way,” he said.

ABH’s takeover of PRL was sparked by an enterprise bargaining agreement PRL was negotiating with the Union of Christmas Island Workers that would involve the placement of about 20 per cent of the shares in PRL in a charitable trust.

Mr Torre said PRL had signed a new EBA with the UCIW and that the agreement did not involve any major share placement.

The two companies have a long history of ill feeling, largely due to an unofficial takeover attempt in 2002 led by former ABH directors Michael Perrott, Peter Huston and David Argyle.

Mr Argyle was the last remaining ABH director from those days.