The Financial Markets Authority (FMA) has elected to discontinue the proceeding against equity firm Archer Capital (Pty) Limited (Archer) and Healthcare Industry Limited (HIL). The defendants, Archer and HIL, have accepted that the FMA was justified in investigating the conduct that is the subject of this claim.
The FMA has concerns about market practice in this area and considers that the claim was justified, but is no longer satisfied that it is in the public interest to progress the matter to trial. The parties have agreed to bear their own costs.
The law provides that a person has a relevant interest in securities held by another person when those parties have an agreement, arrangement, or understanding to act in concert in relation to a power or control (in relation to the security). Parties and their advisers must recognise that the law clearly requires disclosure when arrangements and understandings are reached, and not take an approach that relies on formal, written agreements to trigger disclosure obligations.