[miningmx.com] – IT would appear the resignation of Jan Nelson from Pan African Resources, a company he helped transform into an operating company, was not down to a rift in corporate strategy, but purely personal.
That’s a modicum of comfort to shareholders who must be surprised by the share price reaction: down just under 10% only weeks after the company’s R1.5bn purchase of Evander Gold Mines became unconditional.
The share has since recovered but it’s a reaction Cobus Loots, appointed joint interim CEO of Pan African until a successor can be found, is keen to play down.
Asked if the resignation of Nelson came as a surprise, Loots said it was unanticipated in certain respects.
“But Pan African consists of more than just the CEO who is at the front of the party. There are strong mining skills at other levels, especially in respect of taking on Evander Gold,’ said Loots.
That’s the concern: that having won sanction for the purchase of an asset from shareholders who generally like Pan African for its conservatism, Nelson has now left them in the lurch. (It’s also why the anodyne press release on Nelson’s resignation invites question).
Daniel Sacks, an asset manager for Investec Securities thinks there’s enough in the locker at Pan African to make Evander Mines work for the company. “There are people in the company with the operational experience. Still, I was surprised at the share price reaction,’ he said.
Another shock resignation was Simon Village from Banro. The share fell 22% on the Toronto Stock Exchange. As with Nelson at Pan African Resources, Banro didn’t state a reason for the departure of Village, but market whispers suggest missed production targets is one of the reasons.
One is tempted to draw a comparison between the executive casualties among the large diversified mining companies and their smaller cap industry colleagues; that market conditions are unhinging the careers of nearly all executives in the market.
There’d have to see a few more mining executive resignations that those at Banro and Pan African Resources, however, to believe that quite yet.
