Mighty Kingdom has asked the takeovers panel to restrain its major shareholder

Mighty Kingdom has asked the Takeovers Panel to restrain Shane Yeend’s company Gamestar from voting shares at its annual meeting, because they have not been paid for.

Gamestar founder Shane Yeend.

Mighty Kingdom has asked the Takeovers Panel to restrain its major shareholder, Gamestar and an associated company Imagination Entertainment from voting shares at its upcoming annual meeting, and says Gamestar is misleading the market.

Mighty Kingdom has alleged in its application to the Takeovers Panel that Gamestar, founded and led by Shane Yeend, “continues to make false and misleading statements to the market’’, and also says both companies have failed to lodge substantial shareholder notices “including details of their alleged association’’.

Mr Yeend is a director of both companies, corporate records show.

The Adelaide entrepreneur is attempting to oust the board of Mighty Kingdom, led by former ABC managing director Michelle Guthrie, and has set up a website and issued public statements to the effect that the company has been badly mismanaged.

Gamestar in August last year committed to tipping $4m into a $7m capital raise by Mighty Kingdom, but $2m remains unpaid, with Mr Yeend saying conditions have not been met. The company disagrees.

Mighty Kingdom has told the Takeovers Panel that Gamestar missed its second and third payments for the shares in February and April, but is intending to attempt to vote all of its purported shares, comprising 30.5 per cent of the company’s issued capital, at the annual meeting

It also says that on November 15, “Imagination Entertainment, an alleged associate of Gamestar, acquired 65,951,623 shares from Gamestar, representing approximately 13.9 per cent of the voting shares in Mighty Kingdom’’.

“Mighty Kingdom ... submits that, since October 2023, Gamestar has made, and continues to make, false and misleading statements to the market ... and that both Gamestar and Imagination have failed to lodge substantial holder notices ... including details of their

alleged association.

“Mighty Kingdom has sought interim orders to the effect that Gamestar and its associates be restrained from disposing of, or exercising any voting rights attaching to, 59,657,143 shares in Mighty Kingdom at the AGM and any subsequent general meetings until Gamestar has paid the outstanding subscription price.’’

The Takeovers Panel said in a statement it had not yet convened a sitting panel and “no decision has been made whether to conduct proceedings. The Panel makes no comment on the merits of the application’’.

Mr Yeend on Tuesday sent a letter to a database of Mighty Kingdom shareholders, in which he disputed comments made in the company’s own letter to shareholders issued on Monday.

He says an extraordinary general meeting has been requested “to vote on the replacement of the existing board and end the tragic mess Michelle Guthrie has overseen since listing’’.

“If we don’t get the outcome we want for all shareholders we will fight until Mighty Kingdom is in liquidation, and nobody wins then except me. But I want us all to win.

“We have not paid for 50 per cent of the shares because of their actions, although we tried to accept these issues and continually find a way forward until it was untenable.

“The core issue behind the rhetoric is simple; MKL makes bad games that don’t make money and the world has told us that.’’

Mr Yeend characterises the current Mighty Kingdom leadership team as “snake oil salesmen, liars and cheats’’.

Mighty Kingdom’s letter to shareholders says the company is, “deeply disappointed that Mr Yeend continues to make negative public statements about the company’’.

“These statements are damaging to the company’s reputation and, in the board’s view, seeks to harm our ability to attract new investors and is detrimental to all shareholders,’’ the letter says.

Mighty Kingdom says despite Mr Yeend threatening legal action, no claims have been received by the company.

“The company unequivocally rejects the characterisations and assertions made in Mr Yeend’s communications,

“Shareholders should not rely on Mr Yeend’s comments and top do so would be to act on misinformation.’’

Regarding the Takeovers Panel request from the company, Mr Yeend said to The Australian “Let the tribunal decide’’.