Petroceltic vows to fight after Worldview sues in High Court
Irish oil and gas explorer Petroceltic has pledged to defend a lawsuit being taken against it in the High Court by its largest shareholder, Worldview.
Yesterday Petroceltic said that the Swiss hedge fund, which owns a near-30pc stake in the business, alleged that the oil company failed to undertake a review of its operations. Worldview is seeking direction from the court as to the manner in which the review is undertaken.
The chief executive of the Dublin-based firm, Brian O'Cathain, claimed that the action is "spurious" and says there is no substance to the company's argument.
Worldview has already had similar proceedings thrown out of the English High Court, with costs awarded to Petroceltic.
However, this was mainly due to a jurisdiction issue as the case was pursued through the English courts and Petroceltic is based in Ireland.
Speaking at Petroceltic's annual general meeting in Dublin yesterday, Mr O'Cathain said that he is confident that there is no substance to the investor's claim.
"They say that we should have done a strategic review, [but] we did do a strategic review, so I just don't understand what the case is," he said. "We don't really want to waste time in the courts, but if we are forced to we will seek to recover any costs that we incur from whoever brings the spurious action."
In May last year Worldview raised objections to the terms around a $100m share placing.
In return for its support for the placing Petroceltic agreed, among other measures, to undertake a strategic review of the business. Afterwards Worldview alleged that Petroceltic did not carry out a satisfactory review of the company, while the Dublin firm has maintained that it did.
This accusation formed the basis of Worldview's attempt to oust Mr O'Cathain at an emergency general meeting earlier this year, which failed.
Worldview declined to comment when contacted by the Irish Independent, although a spokeswoman said that the firm would likely give "more clarity" on the issue next week.
The lawsuit is another in a series of bitter boardroom disputes between the two companies. Worldview has recently requested two extraordinary general meetings, one to vote on a proposed $175m bond issue secured on Petroceltic's prime assets in Algeria, and one to seek shareholder approval for all material asset disposals.
Petroceltic is taking legal advice regarding both requests, although the firm has called them unwarranted and a waste of time.