[miningmx.com] – THE contest for control of Resource Generation (Resgen) has taken a sinister turn with the company’s directors claiming shareholders acted in concert in requisitioning a meeting aimed at voting them off the board.
In a statement to the Johannesburg Stock Exchange today, Resgen also said that confidential information, disclosed to shareholders who were participating in talks to fund Resgen’s Boikarabelo mine, had been used in requisitioning the meeting.
“This information may have been used for other purposes in breach of this condition. If
shareholders vote to remove Resource Generation’s existing board, this potential breach is unlikely to be pursued,” the company said in its statement.
As a result, Resgen said that it had written to the Australian Securities and Investments Commission claiming illegal collective action by the shareholders.
The shareholders are Shinto Morii, a subsidiary of Altius Investment Group, the Africa division of Singaporean trading house, Noble Group, and the state-owned South African asset management firm, Public Investment Corporation (PIC).
Boikarabelo is a project situated in the Waterberg coalfields in South Africa’s Limpopo province and has a first phase nameplate capacity of six million tonnes/year (mtpa).
The cost of completing the first phase was $400m – an amount Resgen attempted to raise through a club of bankers that included PIC, Noble and Altius.
However, discussions were protracted and ultimately proved fruitless but not before the bankers, that also included HSBC, asked Resgen to reconsider contractor mining for the project – an avenue the board said it had explored and found to be uneconomic.
During this period, both Noble and Altius sought to expand Resgen’s board on the basis that additional skills would hasten a close to the outstanding funding requirements of the project. Earlier this week, Altius requisitioned a meeting – possibly to be held in November or December – to vote off the entire board and replace it with its own.
Resgen, however, appeared to have sprung a major surprise on shareholders by signing a memorandum of understanding with a Swiss private equity group, HAB & JPR Privee, that could secure $539m in funding for Bokarabelo.
However, the Swiss have reserved the right to pull the funds in the event of Resgen’s board being changed. “Accordingly, Resource Generation has written to Altius asking it to withdraw its requisition for the general meeting so the mine’s funding is not jeopardised,” the company said today.
