ASIC has commenced civil penalty proceedings in the Federal Court of Australia against Antares Energy Limited ('Antares') and one of its directors, former CEO and Chairman James Cruickshank ('Cruickshank') regarding Antares' announcements made in September 2015 about the proposed sale of its oil and gas interests in the Permian Basin of Texas in the United States of America.

The proceedings relate to the company's ASX announcements on 7 September 2015 and 10 September 2015 on the sale of its Northern Star asset (for US$148,788,560) and Big Star asset (for US$105,069,420).

ASIC alleges:　

• The company breached its continuous disclosure obligations by:
• failing to disclose to the ASX prior to 15 September 2015 that the identity of the private equity purchaser of the two assets was Wade Energy; and further, (as an alternative allegation):
• failing to disclose prior to 15 September 2015 collectively the following information:  (a) that Wade Energy was the private equity purchaser; (b) that Antares had not independently verified or otherwise determined the capacity of Wade Energy to complete the purchases; and (c) that Wade Energy had not yet received all financial approvals necessary to complete the purchase of the Big Star asset.
• Mr Cruickshank was involved in the breaches of the company's continuous disclosure obligations, thereby breaching his own continuous disclosure obligations under the Corporations Act, as well as failing to discharge his director's duties to Antares with the degree of care and diligence required.　

ASIC is seeking declarations that Antares breached its continuous disclosure obligations, but is not seeking any other orders against the company.  ASIC is also seeking declarations against Mr Cruickshank that he was involved in the breach by Antares of its continuous disclosure obligations and that he failed to discharge his duty as a director to act with the degree of care and diligence required, as well as financial penalties and orders banning him from managing corporations.

Background

On 15 September 2015, the ASX suspended Antares' shares from official quotation, and that suspension remains in place.

On 28 April 2016, voluntary administrators were appointed to Antares.

Editor's note:

Following a case conference on 22 February 2019, the matter was set down for trial from 2 to 6 September 2019.

Editor's note 2:

The hearing of the matter concluded on 6 September 2019 with a decision on liability reserved.