The ongoing spat between Petroceltic and its biggest shareholder has taken a turn for the worse with Worldview initiating legal proceedings in the High Court against the Irish oil and gas exploration firm.
Petroceltic said on Friday that the Swiss hedge fund, which holds more than 29 per cent of the share capital in the explorer, alleges that the company has failed to undertake a review of its business. Worldview is seeking direction from the court as to the manner in which the review is undertaken.
Similar proceedings were issued by Worldview in London in December and dismissed by the English High Court in May 2015, with costs awarded to Petroceltic, on the grounds that the appropriate jurisdiction was Ireland.
The move comes as Petroceltic received a further letter requesting an extraordinary general meeting (egm) in relation to shareholder approval of asset disposals from Vidacos Nominees, a Cayman Islands-based hedge fund that holds a 26.5 per cent stake in the exploration firm, and of which Worldview is the beneficial owner.
Petroceltic said it believed the latest Irish legal proceedings were “totally without merit and misconceived.”
“The company would clearly prefer to avoid the significant costs of litigation and to ensure that management time is focused on the day to day running of the business for the benefit of all shareholders. Nonetheless, if Worldview decides to pursue the proceedings, the company will be obliged to vigorously contest and defend them and to seek to recover from Worldview, to the maximum extent possible, all costs incurred by the company in so doing,” it said in a statement.
The boardroom dispute between has flared up again in recent weeks after Worldview requested two egms - one to vote on a proposed $175 million bond issue secured on one of its prime assets in Algeria, and one to seek shareholder approval for all material asset disposals. Petroceltic dismissed the requests, which it said were unwarranted and a waste of time.
The investment group has previously claimed that Petroceltic, which is led by chief executive Brian O’Cathain, is “proposing to pledge the company’s crown jewel” - the Ain Tsila asset - because it has “run out of money.”
Worldview, owned by Angelo Moskov, has been at loggerheads with management over allegations that Petroceltic breached a shareholders' agreement struck last year, which the company has consistently denied.
The hedge fund tried to oust Mr O’Cathain and appoint two of its own nominees to the board at a shareholders’ meeting in Dublin. in February. Shareholders, however, blocked the move, voting to retain Mr O’Cathain and to appoint two nominees by Petroceltic’s board.