Big blow for Ascendis Health directors 

The Takeover Regulation Panel (TRP) has accused a consortium looking to buy Ascendis Health – which includes some of the company’s directors – of contravening takeover provisions and acting illegally in its bid to purchase the company.

This follows an investigation into the takeover of Ascendis Health, which the regulator initiated after receiving numerous complaints related to the deal.

In September 2023, Ascendis announced that it is considering joining a string of other JSE-listed companies in delisting from the bourse.

In a cautionary announcement, the company informed shareholders that it has “initiated a process to investigate and progress a potential delisting of Ascendis from the JSE”.

It described this move as the next step in its strategy to unlock value and return capital to Ascendis shareholders.

Furthermore, the company announced that it has entered into discussions with a consortium led by ACN Capital IHC, owned and controlled by Ascendis Health CEO Chris Neethling.

In November 2023, the consortium sent a letter to the Ascendis board confirming its intention to make an offer to acquire all of the company’s ordinary shares from shareholders who do not wish to remain invested in it.

The exit offer was extended to all Ascendis shareholders looking to divest their interests as part of the delisting for a cash consideration of 80 cents per share.

The 80 cents per share that current investors will receive in taking the company private would value Ascendis Health at R500 million.

The consortium consists of the following entities: 

  • ACN Capital, headed by Neethling
  • Carl Andre Capital, of which Neethling is a director
  • Dendrobium Capital, of which Neethling is a director 
  • Emfam Belleggins
  • Kingston Kapitaal, of which Neethling is a director 
  • JVDM Trust

In April this year, the TRP announced that it had received complaints related to this takeover under Section 169 of the Companies Act.

The complaints were regarding other shareholders who, as a result of their relationship with a member of the consortium, are alleged to be acting in concert with the consortium, as well as allegations relating to other instances of non-compliance.

The TRP said that it has received approximately 20 complaints since the announcement of the offer described in the offer documents. 

“While not all of them, a considerable number of these complaints have resulted in remedial action being taken,” the panel said.

“It is worth noting that some of the complainants include former prescribed officers of Ascendis.”

Given these complaints, the panel decided to take proactive measures to ensure that all complaints related to matters preceding this announcement are processed in a systematic and organised manner. 

The panel said this approach will help to avoid any undue delays in finalising the offer.

In a SENS announcement released on 19 June 2024, Ascendis Health informed shareholders that the TRP issued a ruling in terms of which the consortium has been found to have contravened certain provisions of the Takeover Provisions. 

The panel also required the consortium to supplement both its firm intention announcement and circular in the Exit Offer to fully disclose their concert party relationship to all Ascendis Health shareholders.

Ascendis and the consortium said they strongly disagree with the panel’s findings and are assessing their legal options to oppose them in the appropriate forum.