Southland Federated Farmers board member David Rose contacted The Southland Times to voice his concern about a letter he received from businessman Bernard Whimp this week.
Mr Rose said the letter, from Carlyle Securities, offered to buy his Contact Energy shares above market-value price.
However, buried in a large block of fine print on the back of the letter, it was revealed payment for the shares would be made in annual instalments over 10 years, Mr Rose said. "Most people wouldn't even see it."
The Securities Commission yesterday successfully filed an interim injunction against the share transfers in the High Court.
Unsolicited share offers have reportedly been made by partnerships controlled by Mr Whimp to shareholders in Contact Energy, Guinness Peat Group, Vector, DNZ Property and TrustPower.
Mr Rose said he believed the offer was a scam. "I get really upset when I see people being taken down. This guy's preying on people, particularly the elderly, who would take a casual glance at something that looks really attractive," he said. "I feel very strongly about this. Unfortunately we're going through hard times and a lot of people would see an opportunity to turn something into cash, without realising what it actually meant."
Soon after receiving the letter he realised the offer was a variation on an offer Mr Whimp had made in the past; however, that time the offer was to buy shares below market value, Mr Rose said.
Mr Whimp released a short statement about the share offer.
"Our position is that the offers are not misleading. Our legal advice is that the offers are not misleading. The offers are not misleading simply on the `say so' of the Securities Commission. It is a matter for a court to decide."
A High Court hearing to determine whether the offers were misleading will be held in May.
The Southland Times
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