Gilbertson ousted from Jupiter Mines after shareholders rebel against executive pay

Brian Gilbertson

BRIAN Gilbertson, the revered South African mining executive, has been ousted from the board and chairmanship of Jupiter Mines following a shareholder revolt over executive pay.

At a general (“spill”) meeting today, approximately 78% of shareholders voted against Gilbertson’s re-election to the board. They also voted in favour of a resolution to remove Jupiter Mines CEO Priyank Thapliyal by a margin of 74% to 26% against.

An interim CEO would now be appointed in an effort to take the company forward amid a massive share price underperformance, said a shareholder who attended the meeting.

Jupiter Mines owns 49% of Tshipi Borwa, a manganese and iron ore mine located in South Africa’s Northern Cape. The mine 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.

According to a statement prior to the general meeting by AMCI, a 7.44% shareholder in Jupiter Mines, the company’s shares have fallen to 25 Australian cents per share from 40c/share as of September 3 compared to a 43% appreciation in the S&P.ASX 300 Metals & Mining Index over the same period.

“The CEO has not taken proactive steps to address the diminishing value of the company or the underperforming share price, and has failed to pursue and successfully complete any material shareholder value creating opportunities since IPO,” said AMCI director and Jupiter Mines board member Hans-Jürgen Mende.

Mende, who was reappointed to the Jupiter Mines board, added: “This may be due in part to the CEO’s current remuneration structure which incentivises him to pay dividends rather than pursue long term value enhancing growth opportunities”.

In questions posed by shareholders at the general meeting – triggered by a spill resolution at Jupiter Mines’ annual general meeting held on July 30 – Gilbertson responded that the issue of executive had “… cropped up time to time in discussions with shareholders”.

“Those [remuneration] arrangements were set out and entrenched from the outset,” he said. “I really have not felt that they needed to be changed”. About 95.64% of shareholders had voted against the remuneration report at the firm’s AGM. In addition, about 93.4% of shareholders voted against the report in 2020.

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. Thapliyal owns 3.33% of Jupiter Mines while Gilbertson is a 1.27% shareholder.

Jupiter Mines’ largest shareholder is Ntsimbintle Holdings, the South African firm which recently increased its stake in Jupiter Mines to 19.9%. Ntsimbintle Holdings has an effective interest in the underlying Tshipi mine of 47%.

Saki Macozoma, chairman of Ntsimbintle Holdings, said in a statement that he welcomed the outcome of the shareholder vote.

“At the shareholder level, the outcome of these resolutions indicated it was time for governance change and accountability,” he said.

“We are fully engaged with our own long-term investment and in Jupiter Mines of the core asset, the Tshipi Mine … Our considered approach to all our investments is to ensure the mines in which we invest, and support in operation, can best reach their potential and extract a future premium,” he said.

7 COMMENTS

  1. [Comment moderated]

    There you go. The pillaging has finally come to an end. What a way for Brian to end his career, being voted off the board of the company you were the chairman of. What an embarrassment. Brian used to be a leader when he (or should I say Mick Davis) took Billiton international. Since then he only served himself, selling out before hoodwinking investors into his gravy train that was Pallinghurst. It took a long time for Hans Mende to see the light – he was right there as a Pallinghurst investor at the onset. Now he voted to remove his partner, things must have become very sour.

  2. I think what you are missing here David is that Safika and Ntsimbintle the other shareholders of Tshipi have effectively bought control of Jupiter, ousted the old Pallinghurst team and now own and control a ASX listed vehicle. Recall that the two BEE partners have another manganese mine (with Glencore) and can finally consolidate the Kalahari basin. Together with OMH they create a formidable team.
    This is the first time where a BEE has created an entity that has managed not only to be successful but also gain an international foothold. Thats the real story here…..

  3. Wouldn’t it be great if Jupiter could take over Ntsimbintle (or the reverse in reality) and get a secondary listing on the JSE. A pure play R12bn+ manganese play if you include Mokala and Lehateng- owned and controlled by black South African billionaire capitalists – just as Gwede wants.

  4. Oh how the fools got hoodwinked here.

    Predictions: This is the last dividend minority shareholders will receive. Unless there is something legally binding an entity with a controlling stake the main goal now is to pry the rest of the shares away from small investors for as little cost as possible with no big hurry and squander profits on a new set of executives.
    The controlling executives stand to make much more making this private again and then wait for a very hot market to relist it..

    • Absolutely correct. Create a distraction about “remuneration” to get rid of those standing in your way, and then implement your plan. A shame David’s article does not, for example, cite Gilbertson’s own pay on the Jupiter board or state the decline in manganese prices when citing a drop in its share price. But the proof will be in the pudding: let’s see whether the guys now in control actually deliver for minorities. I sure hope the dividend stream does not now vanish – that was a great feature of Jupiter Mines. Much money has been lost in the mining sector by pursuing grand acquisition ambitions and “consolidating” visions. Jupiter never did that – it just kept sending cash to shareholders.

    • Yes you’ve seen it before, the abuse of minorities through the take out (force out) of minorities. You might recall it from Pallinghurst’s track record. They are the ultimate abuser. Platmin, Gemfields, Jupiter, Nemaska…. their tried and trusted formula… bend over minorities the Pallinghurst boys are here to feast.

      Prediction: Corporate action, consolidation of the Kalahari manganese field, growth, governance, loss of value due to transfer pricing etc…. this can only be good for JMS and the minorities. it can only be good for South Africa.

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