REGINA – The Saskatchewan Securities Commission has dismissed claims by two groups that Sask-
atchewan Wheat Pool’s share offering prospectus is inaccurate.
The commission reviewed claims by Doug Nagel of Regina, acting on behalf of Saskatchewan Association Against Citizen Inequities Inc., and Kyle Korneychuk of Pelly, Sask., who acted for Concerned Farmers of District 8. The commission also reviewed the pool’s response to the concerns.
“Based on the responses provided, the staff is of the opinion that no revision is required to the final prospectus of the Saskatchewan Wheat Pool dated Dec. 19, 1995 and will take no further action on these matters,” said commission deputy director of corporate finance Ian McIntosh in a letter to Korneychuk dated Jan. 24.
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Another group has now asked the commission to investigate alleged inaccuracies in the prospectus.
The Co-operating Friends of the Pool, a group opposed to Saskat-
chewan Pool’s plan to sell shares on the Toronto Stock Exchange, listed its areas of concern in a Jan. 24 letter to the commission. The CFOP wants to know why sales were listed as $2.8 billion in the 1994-95 annual report but $3.9 billion in the prospectus, and the true worth of the company. The group said the pool wrongly stated in the prospectus that it buys grain for sale to the Canadian Wheat Board.
The CFOP also asked for outside monitoring and auditing of the share conversion.
John Beke, the pool’s lawyer, said the latest allegations likely “have no greater depth or validity” than the issues raised by Korneychuk and Nagel.
“You might call that prejudging it but we are very confident in the full and plain and true disclosure contained in the prospectus,” Beke said at a news conference, adding that “these are phony accusations for an improper purpose.”
In December, he explained the difference in sales figures listed in the annual report and the prospectus reflected new nationally adopted accounting principles that were established in the last year. Because of this change, the securities commission required the pool to refile its statements with a different method of reporting income from its subsidiaries.
Pool president Leroy Larsen sent a letter to all pool members last week to try to clear up misunderstandings. He said staff have answered many questions from callers to the company’s toll-free line who are confused by the information from Nagel and Korneychuk.
“They’re asking, ‘Is there some problem with the prospectus?’ and we’re here today to say, ‘No, the prospectus has been approved and the securities commission has deemed that no changes are necessary,’ ” Larsen said.
Beke said people opposed to the share plan should be careful what they say.
“There is a risk … that they cross the line and are giving investment advice,” he said of those who are urging people to sell their shares. He added it is illegal for unregistered people to give investment advice.
When asked if the pool could revoke someone’s membership, Larsen said that would be an “extreme action,” but the board does have power to redeem a member’s shares and thus end their membership. “If some individuals continue to persist in this manner it would have consideration by the board at a future time.”
Beke noted that “rather than stifle them by redeeming their shares, we’re responding and making sure everybody understands what the truth of the matter is.”
