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Australia’s SolGold Plc has rebuked rival BHP Group, the world’s biggest mining company, for allegedly meddling in the reappointment of its board members.
“It has come to my attention in recent weeks that one of SolGold’s significant shareholders, BHP Group Ltd., has been actively canvassing certain shareholders and members of the board” ahead of an upcoming meeting, Chairman Liam Twigger said in a letter to investors on Wednesday.
He said that putting the entire board up for re-election next month would “destabilize” SolGold and undermine the process to find a new chief executive.
As SolGold’s biggest shareholder, BHP has long been seen as a likely buyer for the company, yet the relationship has not always been smooth. Today’s barb from Twigger is likely to flare those tensions, with the chairman suggesting that if BHP wants to influence the business, it should make an offer to buy it.
“Ultimately, if a party wants control or to significantly influence the development of your company, the party should put forward an offer that results in all shareholders benefiting from a premium that reflects the value of achieving control or heightened influence,” Twigger said in the letter.
A spokesman for BHP declined to comment.
SolGold, worth $800 million, has drawn attention from across the industry because of the size of its Cascabel copper project in Ecuador. BHP owns 13.5% of the company, and the prospects of a takeover are likely to increase once SolGold’s long-delayed pre-feasibility study is complete.
SolGold is holding its annual general meeting next month. Twigger proposed that in order to maintain stability at the company, only three of the directors — who didn’t stand for re-election last year — and the company’s new CEO will face a vote at the shareholder meeting. The six other board members, including Nick Mather, the company’s co-founder and one of its biggest shareholders, who were re-elected last year will not.
Mather stood down earlier this year after he won the support of just 55% of investors. That result suggested that some of SolGold’s biggest shareholders voted against his reappointment. He continues to sit on the company’s board.
(By Thomas Biesheuvel)
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