AWB Shares: Shady Dealings

Submitted by Marco on 9 November, 2006 - 13:06

AWB Shares: Shady dealings by David Tweed

There has been some shady dealings with respect to AWB shares, David Tweed and his company "Australian Share Purchasing Corporation." A number of farmers in Victoria have reported receiving a letter from Tweed's company offering to buy their AWB shares for well under their market value. Australian Share Purchasing is offering to buy AWB shares off the farmers for $1.50 per share - compare that to the price of $2.71 - that was the share price for AWB when farmers were receiving the letters.

David Tweed isn't new in the business of shady dealings. His offer to buy AWB shares isn't the first, his name is notorious for targeting shareholders with unsolicited offers to purchase their shares for well below market value. In David Tweed's latest ploy, he is targeting unsuspecting, cash-strapped farmers. The Victorian Farmers Federation (VFF) is warning their not to sell shares without professional advice. The letter being sent to farmers clearly states what the market price is and what Mr Tweed's offer is - since he discloses the market price to the shareholder, his offer is not illegal. However the VFF are concerned that farmers will see this as an easy way to get some much needed cash.

The ABC recently reported about these shady dealings about the AWB shares being offered to farmers and they went to Tim Sheehy, the Chief Executive of the Chartered Secretaries of Australia. They said that Tweed's company Share Purchasing Corporation have also recently targeted shareholders of companies like Rinker, AMP and Coles Myer. Sheehy wants the Corporations Act to be changed to restrict Tweed's activities. According to the ABC, PM program, they tried to contact " Share Purchasing Corporation" but only got an answering machine:

Hello, you have reached the Direct Share Purchasing Corporation's Share Offer information line. Our offer is regulated by Division 5A of Part 7.9 of the Corporations Act.

It is an offer to purchase your shares at the price and subject to the payment terms and other terms stated in the offer.

To accept the offer, please sign the acceptance form enclosed in the offer and send it to us.

AWB Limited is listed on the Australian Stock Exchange (ASX) under stock code AWB. You can view their investor website here. AWB is an abbreviation for Australian Wheat Board. AWB was listed on the ASX on 22 August, 2001. AWB is involved in Wheat management and marketing services. Find out the meaning of the recommendations in this primer. Browse for other stockbroker recommendations. Check your charts and good luck with your share trading!

More about