Shane Yeend’s Gamestar blocked from voting shares, as he seeks to oust Mighty Kingdom board

Shane Yeend’s Gamestar has been blocked from voting Mighty Kingdom shares, ahead of meeting where he aims to oust chair Michelle Guthrie.

Mighty Kingdom chair Michelle Guthrie.

Shane Yeend’s efforts to oust Michelle Guthrie as chair of game developer Mighty Kingdom have been dealt a blow, with the Takeovers Panel ruling a large tranche of shares - which have not been paid for - cannot be voted.

Mighty Kingdom, an Adelaide-based game developer, will hold its annual meeting on Wednesday afternoon at which Mr Yeend has said he will attempt to vote out Ms Guthrie as chair.

Using his substantial shareholding in the company he has also called for an extraordinary general meeting where he will attempt to roll the board and install himself and his own hand-picked board members and management.

It remains to be seen whether that EGM will be held, and if it is, it will likely not eventuate until next year.

In the meantime Mr Yeend has been rallying shareholders to vote against Ms Guthrie’s re-election at today’s annual meeting, alleging the company has been mismanaged.

Mr Yeend and his companies were the cornerstone investors in a $7m Mighty Kingdom capital raise in August last year, but they have not paid for about $2m worth of the $4m in shares they were allotted.

Mr Yeend argues this is due to conditions under the capital raise agreement not being met, which is disputed by the company, which has engaged top Adelaide firm LK Law in a bid to press the matter.

Mr Yeend was also chief executive of Mighty Kingdom from May until late August this year, on a nominal salary of $1, before quitting abruptly, telling The Australian he had done so before it was announced to the ASX.

He has been running a campaign in the past couple of months to oust the board, setting up a website setting out how he believes the company has been mismanaged, and urging shareholders to vote Ms Guthrie out.

Should he be successful in calling an EGM, Mr Yeend intends to attempt to vote out the current board and replace them, and also install his choice of chief executive.

Mighty Kingdom last week asked the Takeovers Panel to restrain Mr Yeend’s companies Gamestar and Imagination Entertainment from voting their shares at its upcoming annual meeting, as they had not been paid for, and said Gamestar was misleading the market.

On Wednesday the Takeovers Panel announced it had accepted an undertaking from Gamestar and Imagination that they would not attempt to vote the unpaid shares, or transfer or sell them.

Mighty Kingdom said on Monday Gamestar’s stake constituted 13.7 per cent of the company’s issued capital.

Also on Monday it issued a statement to the ASX saying Gamestar had made assertions to its own shareholders which it rejected.

The letter from Gamestar said, “We are currently in detailed discussion to potentially merge Gamestar into Mighty Kingdom and take control’’.

“If successful, this move will provide us with access to significant institutional capital.’’

Mighty Kingdom told the ASX, “it is not in any discussions with Gamestar regarding a merger or change of control transaction nor has it ever been in the past’’.

The annual meeting is scheduled for 4pm Adelaide time on Wednesday.

Originally published as Shane Yeend’s Gamestar blocked from voting shares, as he seeks to oust Mighty Kingdom board