28th Feb 2020 12:10
(Alliance News) - Karelian Diamond Resources PLC on Friday said it has made "further progress" at its Lahtojoki diamond mine in Finland, but took aim at a group of shareholders for "hindering" the business.
In the six months to November 30, the diamond exploration firm's pretax loss stretched to EUR250,150 from EUR215,342.
Karelian did not generate any revenue in the period, as it continues its diamond exploration and development programme.
During the interim period, Karelian found the presence of coloured stones, including pink diamonds, at Lahtojoki.
Karelian added: "Examination of the pink diamonds indicates that these diamonds are of high quality and therefore potentially especially valuable.
"Progress in relation to mandatory regulatory matters under the Finnish mining laws continued to be made. In particular, the process in relation to agreeing compensation for landowners at Lahtojoki is now at an advanced stage."
The company added that it has been forced to "contend with a series of actions by a group of shareholders", who proposed wholesale changes to Karelian's board.
At the start of September, Interactive Investor Services Nominees Ltd and Share Nominees Ltd & (Rock) Nominees Ltd, which cover 12% of Karelian's shares, requested an extraordinary general meeting. This was after an EGM was held in July.
Shareholders in October voted on the removal of several directors including Chair Richard Conroy, Managing Director Maureen Jones, and Non-Executive Directors Seamus FitzPatrick, Sorca Conroy and Louis Maguire. In their place, the activists proposed that Alan Osborne, Stephen Grimmer, Martin Doyle and Kevin Taylor join as directors.
Karelian shareholders voted against all resolutions, meaning the company's board remained the same after the vote.
Karelian said: "The requisitionists, in association with a former employee/consultant to the company, endeavoured to gain control of the company by removing all but two of the current members of the board and electing four replacements, nominated by them, to the board.
"The resolutions were rejected by shareholders of the company at the first EGM, and the same resolutions were defeated by an even larger majority at the second EGM."
Karelian shares were 8.2% lower at 2.80 pence each in London on Friday around midday.
By Eric Cunha; [email protected]
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