9th May 2019 14:32
LONDON (Alliance News) - First Investment Holding Ltd said Thursday a recently announced investment by Argo Blockchain PLC reinforced its view that investors should vote in favour of its move to replace several board members.
First Investment - which holds a 14% stake in Argo - noted that on Wednesday Argo had announced it had paid GBP1.7 million on what First Investment described as "rapidly depreciating mining hardware."
On Wednesday, Argo had explained that 1,000 of its Bitmain Z11 mining units came into production last Thursday.
First Investment noted that Executive Directors Jonathan Bixby and Mike Edwards had made this additional investment - which represented over 10% of cash assets as of the end of March - despite it having requisitioned a meeting for next Thursday.
The meeting puts forward proposals to shareholders which could see Bixby and Edwards amid concern about the direction of the firm.
First Investments explained it was "extremely surprised and disappointed" that Bixby and Edwards were "continuing to expend shareholders' funds on such hardware" during the notice period for the
requisitioned general meeting.
This is in light of what First Investments termed as the "significant shareholders' concerns regarding the company's strategy and cash burn" and considering the meeting is looking to bring about "a change in strategy in order to preserve the remaining
cash on Argo's balance sheet."
First Investments also noted that on Sunday Bixby and Edwards had put forward a proposal to buyout the cryptocurrency business in a management buyout.
As a consequence of what First described as the "total lack of regard for the views of shareholders" expressed in the new acquisition, the firm reiterates its "strong recommendation" to back the resolutions to remove the executives.
Shares in Argo were 4.0% lower at 3.36 pence on Thursday.
Related Shares:
Argo Blockchai.