Empire activists seek a strategic review and new board
A group of dissident shareholders in Empire Resources has outlined its plan for the company, saying it needed a new “energetic” executive managing director to complete a strategic review of the precious and base metals explorer.
The dissidents, consisting of 12 shareholders, are seeking to replace the entire three-member board with three new directors, arguing that incumbent directors David Sargeant and Adrian Jessup are in their 70s and “may not have the motivation necessary to continue to promote shareholder interests.” They also noted that the company is on track to issue 100 million additional shares at a significant discount to the market.
The precious metals explorer said the activists had links to Paul Williams, an executive at Brimstone Resources, which is developing Penny’s Find Mining together with Empire. The dissidents, however, denied they were involved with Williams. Shares in Empire have fallen by as much as 30% since the beginning of the year.
The shareholder meeting is expected to take place on July 24.
Fleetwood sells caravan manufacturing unit in response to activist pressure
Fleetwood, the Australian provider of accommodation solutions, agreed to sell the struggling caravan manufacturing unit to Apollo Tourism & Leisure for AU$1 million, putting a cap to years of suffering as the market for recreational vehicles has been shrinking. Second half losses for the caravan division are expected to be between AU$7 and AU$8 million as promotional and marketing costs will increase dramatically.
Activist investor Sandon Capital believes Fleetwood’s sale of its caravan manufacturing unit was long overdue and should have been sold much earlier. Their campaign at Fleetwood is not over however. The investor is now agitating for the company to sell its Camec parts business, which manufactures accessories for caravans. Sandon also believes the future of managing director, Brad Denison, is uncertain given the price the caravan business was sold for.
Shares in Fleetwood are down more than 17% since the beginning of the year.
MEC shareholder lines up against dissident group
Spectre Capital, a shareholder in Australian-based MEC Resources, has criticised a group of dissident investors seeking control of the board, and urged fellow shareholders to support the status quo.
Spectre, which says it was formed by several high net worth individuals and family offices across the Americas and the Middle East, said the dissidents are not acting in favor of the company and should not be allowed in the boardroom. They argue that none of the three nominees had the necessary experience to lead MEC and accused Tom Fontaine of being connected to David Breeze.
The dissident group owns more than 6% of the stock and is comprised of 15 shareholders. It is seeking to appoint three directors and remove six incumbents. This is the same group that in January announced its intention to challenge the board after the miner rejected a financing package from David Breeze. The company had said that Breeze, the founder of BPH Energy who has been fighting with the company since the beginning of 2017, is behind the proxy contest.
Spectre is engaged in an ongoing war with Breeze, seeking his removal from BPH Energy, where he serves as chairman.
New Zealand retailer, Smiths City, appoints activist nominee to the Board
New Zealand-based furniture and appliance retailer Smiths City has announced the appointment of Antony Karp as a new non-executive director. Karp, the former chief operating officer of Specialty Fashion Group, was nominated to the board by Sandon Capital and Mercantile Investments.
In addition to Karp’s appointment, Smiths announced the resignation of independent director Sheena Henderson, effective at the end of June.
News of the board shakeup came a little more than one month after the company underwent previous board changes, including the replacement of chair Craig Boyce with Alastair Kerr and the resignation of independent director Gary Rohloff.
Rision appoints new directors, again.
Rision has appointed two new directors Paul Steele and Adam Sierakowski to its board, less than one month after dissident shareholder Pebtilly sent Rision a requisition notice (May 25) seeking the removal of directors David Halliday and Christopher Wilson as well as the director appointments of Rision founder Robert Day, former chairman Sierakowski, and former CEO Steele.
Following the requisition notice, David Halliday resigned as a director. The company did not provide a reason for his departure. Rision’s board now consists of three members: Wilson, Steele, and Sierakowski.
This was the second time Pebtilly requisitioned a meeting at Rision. In June 2016, the company sought the appointment of Sierakowski as a director. Rision eventually settled and appointed Sierakowski as chairman following the resignation of three directors.
Baraka Energy faces board challenge from GTT Global
Australian oil and gas explorer Baraka Energy and Resources is set for a confrontation with a group of shareholders, who are seeking to replace the entire board. Baraka announced on 14 June that a group of shareholders, led by GTT Global Opportunities, had requisitioned a special meeting to replace Chairman Collin Vost and directors Justin Vost and Ray Chang, who is also the manager of the Chinese division.
The activists’ three nominees are Jason Paul Brewer, the executive director of Force Commodities who has experience in the natural resources sector and investment banking, Chris Zielinski and Michael Glovac, a serial board member and director at Murdoch Capital, one of the requisitionists.
GTT Global had previously targeted Viking Mines in 2017 and gained a board seat in November following a proxy contest.
Mineral Deposits spurns revised offer from Eramet
Australia’s Mineral Deposits recommended shareholders reject a higher takeover offer from French miner Eramet, contending it still undervalues the firm.
Eramet increased its all-cash offer from AU$1.46 per share AU$1.75, saying it is its best and final offer. However, an independent expert concluded Mineral Deposits is worth anywhere between AU$2.04 and AU$2.52. Despite the lack of support from the board, Eramet still hopes that enough shareholders will tender their shares to gain control of the firm.
Allan Gray, the company’s largest shareholder with a 14% stake, has yet to decide whether to accept the offer while Ellerston Capital, with a 5.3 percent stake, said it was fine with the revised offer. Sandon Capital, an activist investor, said that it supported management’s move to reject the takeover offer, citing the expert’s valuation.
Keybridge victorious in Molopo board campaign and Aurora bid acknowledged by the Takeovers Panel
Keybridge Capital won a proxy contest against Australian-listed Molopo Energy on 1 June, successfully capping a nearly four-year campaign to produce boardroom changes at the firm. Four dissident nominees were elected to the board with more than 55% of the shares present in their favor.
Keybridge itself nominated only one candidate, William Johnson, but at least two others are believed to have ties to the activist or its partner Aurora Funds Management.
Keybridge and Aurora have been separately attempting to take control of the company since 2014. Last year, Australia’s Takeovers Panel ruled that Keybridge and Aurora had acted in concert, ordering Aurora to divest a large part of its 20% stake.
However a week later Australia’s Takeovers Panel declared unacceptable circumstances in the battle between Molopo Energy and its bidder Aurora Funds Management, ruling that Molopo’s previous management failed to give shareholders the right to choose between a change of strategy and Aurora’s takeover bid. The Australian authority said it would make “final orders, if any” regarding the matter in due course.
The fate of the battle tilted in favor of the activists after the Australian Securities Exchange (ASX) notified Molopo of its failure to report certain transactions, which included the acquisition of Orient, a company owning drilling land in Florida, for $7 million. The activists fiercely opposed the Orient transaction.
The Takeovers Panel now agrees with ASX that Molopo should have put the Orient transaction to a shareholder vote. It also ruled that the former directors tried to prevent Aurora’s bid from proceeding.
Watpac investors reject Besix’s takeover offer
Investors in Australian mining services group Watpac rejected a takeover offer by construction company Besix, which was seeking to increase its stake in Watpac from 28.1% currently to 64.1%. The proposal secured just 67% of the votes, not enough for the resolution to pass the 75% threshold.
Institutional Shareholder Services recommended investors vote down the proportional takeover, saying it had the potential to hurt minority shareholders as they would cede control to the Belgian company. CGI Glass Lewis, another proxy adviser, reportedly recommended a vote for the deal.
Activist investor, Sandon Capital, which owns a 3% stake in Watpac, was vocal against the proposed takeover offer, deeming it opportunistic and undervaluing the company.
Besix’s CEO Rik Vandenberghe said that the company will now analyze the results of the vote and will evaluate its position and future plans with Watpac. Besix hinted prior to the vote that it might sell its entire stake.
Peter Watson, Watpac chairman, said that the outcome was a “real disappointment” for what he deemed a “reasonable offer.”
Shareholder proposal fails at New Zealand’s Millennium & Copthorne
Shareholder Howard Zingel failed to push New Zealand’s Millennium & Copthorne hotel chain to initiate a special dividend and payment to its staff and directors.
Zingel advanced a shareholder proposal to be voted on at the company’s annual meeting, requesting Millennium pay a special dividend to shareholders by the end of the year. Zingel also sought a bonus payment of $1,000 for staff members who have served the company for more than a year and a bonus payment of $5,000 to its directors.
However, approximately 99.6% of shareholders voted against the proposal at Millennium’s annual meeting.