11th Jun 2018 08:55
LONDON (Alliance News) - Russian gold miner Petropavlovsk PLC's second largest shareholder Sothic Capital Management UK LLP said Monday it is "strongly against" replacing the company's board.
In an open letter to its fellow shareholders, Sothic Capital, owner of a 10.9% stake in the company, said it is against the proposal by anonymous shareholders CABS Platform Ltd and Slevin Ltd to replace the entire current board.
"Sothic considers the so-called activist attempt by CABS and Slevin as being contrary to good corporate governance and one which could jeopardise the significant value potential of Petropavlovsk," the letter reads.
Sothic said the proposal "lacks transparency" and poses a real risk to shareholders as it is "directly contrary" to the corporate strategy in place.
Earlier in May, CABS and Slevin, who have a combined 9.1% stake, issued a requisition notice to remove all Petropavlovsk directors and replace them with Pavel Maslovskiy, Roderic Lyne, and Robert Jenkins, all of whom are former directors of the company.
Kenges Rakishev, owner of Petropavlovsk's largest shareholder Fincraft, said he will direct Fincraft to vote in favour of the resolution by CABS and Slevin to shake up the board.
Petropavlovsk is investigating the identities of the two "mystery" shareholders, as CABS disclosed a series of names on Friday. However, the company said it does not believe the individual named are the ultimate owners of the company.
Sothic said: "We are deeply concerned as the second-largest shareholder of Petropavlovsk that we do not know the true identity or business interests of the controlling shareholder of both CABS and Slevin, which are registered in Cyprus and Tortola, BVI, respectively, where transparent disclosure of ownership is not required."
Sothic said it is worried that the move could be part of a strategy to "takeover Petropavlovsk by stealth means at a discount".
Petropavlovsk shares were trading down 1.5% at 8.03 pence each on Monday.
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