SA mining icon Brian Gilbertson may be forced off board amid executive pay furore

A BOARD coup is underway at Sydney-listed Jupiter Mines after shareholders resoundingly voted down the company’s remuneration report and refused to re-elect two directors.

Jupiter Mines owns 49% of Tshipi Borwa, a manganese and iron ore mine located in South Africa’s Northern Cape. It produced 3.4 million tons (Mt) of manganese ore last year against a 3.1Mt budget and is currently working through a feasibility study to take production to 4.5Mt annually.

A presentation of Jupiter Mines’ annual general meeting (AGM) published on the firm’s website showed that on July 30 a majority 95.64% of shareholders rejected the adoption of the remuneration report.

In addition, Jupiter non-executive directors Paul Murray and Andrew Bell were voted off the board after shareholders said they were against their re-election. Murray was the chairman of the remuneration and nomination committee.

The position of other directors, including Jupiter’s chairman, Brian Gilbertson remains unclear after nearly 87% of shareholders voted for a ‘spill resolution’. A spill resolution is a consequence of the remuneration report having been rejected and enables shareholders to hold another meeting within 90 days. At that second meeting, current board members, excluding the CEO, “will cease to hold office”, according to Jupiter’s AGM documentation.

Jupiter Mines CEO is Priyank Thapliyal who has been criticised for failing to grow Jupiter Mines, preferring instead to harvest his 1% of dividend flow, said a market source who spoke to Miningmx on condition of anonymity.

Dissenting shareholders wanted Thapliyal to undertake merger and acquisition activity and seek to buy more shares in Tshipi, the source stated. Thapliyal owns 3.33% of Jupiter Mines while Gilbertson is a 1.27% shareholder.

The largest shareholders in Jupiter Mines are AMCI, a natural resources investment and trading company, which has a 7.44% stake, and Ntsimbintle Holdings, the South African firm that recently increased its stake in Jupiter Mines to 19.9%. Ntsimbintle Holdings now has an effective interest in the underlying Tshipi mine of 47%.

Shareholders voted in favour of the election of Peter North and William Winter to the board. North, an ex-banker, helped establish Safika Holdings which is a shareholder in Ntsimbintle Holdings. Safika Holdings is owned by Saki Macozoma, a former Robben Islander imprisoned with former South African president, the late Nelson Mandela.

According to the remuneration report, Thapliyal was to receive total pay of $1.38m including cash and salary fees of $751,166 in 2021 compared to total pay of $1.73m in 2020 and cash and salary fees of $766,744.

Shareholders have rejected the remuneration report for the last four years, an outcome that the board doesn’t necessarily have to act on. At the AGM, Gilbertson is reported to have said he had engaged with shareholders on the matter of remuneration.

9 COMMENTS

  1. So typical of a Gilbertson company! Shareholders always fund the fat cats who keep finding ways to milk the carcass! I hope shareholders boot Brian into touch, he deserves it!

    • Spoken like someone with an axe to grind and who has conveniently chosen to ignore the total shareholder return (and dividend yield!) from Jupiter. Many a company has lost its way pursuing grandiose deals. Opting for steady and solid cash streams from dividends is a perfectly valid strategy.

  2. The CEO gets 1% of all Jupiter shares – he is utterly useless and has milked the company for years without ever adding an ounce of value. the writing is on the wall….. time for shareholders to stand up. SO good to see BEE getting a significant stake on a foreign listed company.

    • @Bobs your uncle (presumably a.k.a “Gem” in the first comment): you say “The CEO gets 1% of all Jupiter shares”. Shouldn’t that be “The CEO BOUGHT 1% of all Jupiter shares”? So, salary aside, how is that “milking” the company? I see Bloomberg today indicates a 10% dividend yield for Jupiter. The CEO may be getting the dividends on the 1% of Jupiter he bought and paid for, but presumably the other shareholders are getting the other 99%! Not too many shares pay that sort of dividend yield. I imagine many CEOs wouldn’t pay out the cash as dividends and would instead use it instead to pursue grandiose visions, so kudos to this CEO for sending the cash where it belongs (and long may it continue)!

      • Error 1% of every dividend declared by Jupiter ends up in the CEO’s pocket as a bonus. He doesn’t need to do a thing, just show up for work. Tshipi has its own board and management and the CEO of Jupiter just collects dividends (from Tshipi) and a fat pay check – he adds no value to Tshipi, has nothing to do with Tshipi’s day to day operations and yet his bonus is dependant on Tshipi’s operational success. He is unnecessary, over paid and can be removed from the system (to the benefit of shareholders).
        Perhaps the reason why he pays so much in dividends is because he is incentivised to do so, and this is exactly why over the last 4 years shareholders have voted against the remuneration policy – at the last AGM 95.6% voted against the remcom report! That means long associates such as Meande, Kundrin, AMCI and Posco also voted against it. Thats embarrassing.
        A 10% dividend yield just shows how undervalued the shares are, a 10% dividend yield is not something to be proud of, it’s an embarrassment and testament to something desperately wrong with the company.
        A postbox company without any operations who’s CEO gets paid $1.4m is a further indication something is wrong – go read page 25 and 26 of the AFS. You suggest that a CEO who just sits on his hands and pays out all FCF as dividends deserves an annual salary of $1.4m?
        BRING ON THE SPILL MEETING.

  3. This post has been edited.

    MrLetsBalance sounds like an expansive PR firm hired by the Chairman who’s finally being called out for what he and his cronies are!

  4. @Bobsyouruncle2: there’s so much wrong with your view above. For example, Bloomberg shows a 8% dividend yield for the mighty Rio Tinto. I supposed you consider that “embarrassing” too and a sign that something is “desperately wrong” at Rio Tinto? Your description of a listed company CEO turning up for work and collecting dividends from underlying subsidiaries that have their own boards and management teams could also apply to Rio Tinto, BHP, Glencore, etc. Lastly, in relation to AGM voting, you seem to forget that the voting percentages are calculated only on those shareholders actually casting votes on the matter, not across all shareholders of the company.

  5. Rio Tinto’s average dividend yield over the last 5 years was 5.45%, BHP DY is 4.69% and Jupiters was consistently 10%. Jupiter never traded above list price of 40cps – because something is wrong….
    As for subsidiaries Jupiter has one minority stake in an operating company and thats in Tshipi. nothing more. Rio, BHP, Glencore are vastly different companies having multiple operational subsidiaries MANAGED by the parent. JMS does not manage Tshipi.
    The CEO took $1.4m in pay this last year the previous last year it was $1.7m. The total costs of staff for 2021 were $2.163m (one individual taking home 64% of the entire company’s salary bill, in 2020 that was 67%).
    Upon termination the CEO will get 12 months salary plus last years Bonus! for getting fired. Come on how can you even defend that?
    Spill resolution carried by 47% of all shares in issue, assuming some don’t vote at the spill board meeting its a fait accompli. Safika and Ntsmbintle now control JMS – thats the fact.
    I’m going to enjoy watching this one play out. Now does Brian resign before he is voted off?

  6. @BYU: loved your comment and think you’ve hit the nail on the head as to what is really going on here – this is an attempt by Safika / Ntsimbintle (and supporters) at acquiring control of Jupiter WITHOUT paying a control premium to Jupiter’s existing shareholders. After their own repeated efforts at an IPO went nowhere, getting control of Jupiter in this way will allow them to buy their 51% stake in Tshipi into Jupiter in return for new Jupiter shares (at a valuation their new board can drive – nice!). So, standard tactic is to detract shareholders by creating a noise about how seemingly bad the incumbent board members are while simultaneously planning to get your own guys on for your own purposes. Standard Trojan Horse play. Whatever happens, it’s going to be interesting to watch!

Comments are closed.