Mighty Kingdom activist shareholder Shane Yeend slammed by Takeovers Panel

Activist investor Shane Yeend has been slammed by the Takeovers Panel for “misrepresenting” the outcome of a dispute with game developer Mighty Kingdom.

Activist shareholder Shane Yeend. Picture: AAP Image/Morgan Sette

The activist shareholder who narrowly failed to spill the board of embattled video game developer Might Kingdom is facing disciplinary action after being found in breach of an order from the Takeovers Panel regarding a dispute over the purchase of shares in the company.

Shane Yeend, who has been rallying shareholders to overthrow Mighty Kingdom’s current board, has been found to have breached the terms of an agreement with the Panel in the lead up to an extraordinary general meeting last Friday, where shareholders voted against his bid to unseat the company’s current directors.

In a statement issued on Tuesday, the Panel said comments made by Mr Yeend in the lead up to the vote “misrepresented” a decision made by the Panel in mid-December regarding a $7m capital raise in 2022.

“While Mr Yeend has, at the Panel’s request, issued a corrective statement to shareholders of Mighty Kingdom Limited, the Panel notes that, as at the date of this media release, the incorrect statements remain on public platforms,” it said.

“Therefore, the Panel considers that Mr Yeend did not address the Panel’s concerns in a satisfactory manner and that the contravention of the rules is ongoing.

“The Panel takes non-compliance with the undertakings seriously and considers that such non-compliance may adversely affect its ability to resolve disputes as quickly and efficiently as possible.”

The Adelaide businessman’s battle with Mighty Kingdom in recent months stems from the controversial capital raise, into which his company Gamestar committed to putting $4m.

About half of that money was never paid, with Mr Yeend - the company’s largest shareholder - claiming the conditions under the agreement were not met.

The Takeovers Panel in mid-December said it had accepted undertakings from Mr Yeend and related entities under which the shares would be bought back by Mighty Kingdom for no consideration and cancelled.

Mr Yeend was later ordered by the Takeovers Panel to release a corrective statement clarifying the outcome of the proceedings, following statements he released that suggested the proceedings had been withdrawn.

The Panel on Tuesday said various actions could be taken against Mr Yeend for the contravention, including publicly reprimanding him and applying for a court order requiring him to comply with undertakings he previously made or providing compensation.

It said it would comment further on the matter when it publishes its reasons for its earlier decision regarding the share purchase dispute.

At the extraordinary general meeting on Friday, Mr Yeend’s attempts to spill the Mighty Kingdom board were narrowly defeated, with about 53 per cent of shareholders voting against resolutions to replace the board with himself and three other hand-picked nominees.

Mighty Kingdom shares fell 12.5 per cent on Tuesday to 1.4c.