Question
feel confused about this question Citrus Ltd, a gold mining company listed on the ASX, is currently the subject of a hostile takeover from Anglo
feel confused about this question
Citrus Ltd, a gold mining company listed on the ASX, is currently the subject of a hostile takeover from Anglo Brit Ltd. Prior to Anglo Brit's announcement, the market capitalisation of Citrus Ltd is currently $100 million and its pre-takeover share price is $1.00. Anglo Brit has offered $1.20 per share for Citrus, representing a 20% premium. The directors of Citrus Ltd devise an ingenious plan to defeat the takeover. The board manages to convince one of its directors, Mr Lang, to be provided with an interest-free loan worth $20 million. The loan was for the purpose of purchasing shares in Citrus Ltd in order to push up the company's share price. This will mean that Anglo Brit will have to offer more to the Citrus shareholders if they are to successfully take over the company.
Have the directors of Citrus Ltd breached their directors' duties (in particular duty to act for good faith in the best interests of the company and for a proper purpose) in relation to the loan that has been advanced to Lang?
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