Solomon withdraws Wesizwe court action

Allan Seccombe | Thu, 12 Nov 2009 15:31
[miningmx.com] -- MIKE Solomon and Robert Rainey have opted to let shareholders decide their fate rather than contest their dismissal from the board of platinum junior Wesizwe in court.

Solomon, who was CEO, and Rainey, a non-executive director, withdrew their urgent court application to interdict and restrain the Wesizwe board that voted to dismiss them from the company on 2 November.

A group of shareholders have written a letter to the incumbent Wesizwe board, calling for an extraordinary general meeting thereby triggering a regulatory process that compels management to convene a meeting.

A sizeable shareholder contingent is understood to back Solomon and Rainey and they are demanding answers from the four members of the then-seven member board who voted the two men out.

“In view of the requisition by certain shareholders for a general meeting, and in the best interests of Wesizwe, I have withdrawn by interim court application that was related to an issue that will now be dealt with at the shareholders meeting," Solomon said.

Rainey had the same reason for withdrawing his court action, which was to have been heard on Thursday morning.

It’s reliably understood that if shareholders vote to keep the board intact instead of voting in favour of a new board Solomon will walk away from Wesizwe.

“The company opposed the application as its removal of Solomon and Rainey was in the best interests of the company and its shareholders, and was both procedurally and substantively lawful,” Wesizwe said in a statement on Thursday.

Solomon and Rainey argue that the process was procedurally flawed and unlawful.

Wesizwe has a well-explored platinum deposit at Frischgewaagd-Ledig capable of hosting a 980 metre deep mine that will produce 350,000 oz of platinum group metals a year.

Wesizwe has found itself in a funding crunch and has mothballed the project until it has clear sight of the nearly R6bn it needs to build the twin-shaft mine and concentrator. Speculation is rife that Impala Platinum is casting a covetous eye over the project. Wesizwe is trading under a cautionary notice. The other two options Wesizwe is considering to build the mine are a fund raising scheme and a deal to bring in a new partner, most probably a Chinese or Japanese firm wanting to secure its source of platinum group metals, given worries over possible future shortages of supply.