ASF Group has moved to usurp control of Rey Resources from its current board of directors, as hostilities increase ahead of Rey’s ‘second strike’ annual meeting next week.
Rey Resources chairman Charlie Lenergan circulated a letter to shareholders today, detailing ASF's lobbying for the resignation of all but one of the existing non-executive directors, and proposing the future appointment of a non-executive director backed by ASF.
ASF holds a 23 per cent stake in Rey and currently has two nominees on the board of eight directors.
Mr Lenergan said the non-ASF directors believed it would not be in the interests of security holders for any single shareholder to have board representation at a level not commensurate with its stake in the company.
Mr Lenergan said, however, the non-ASF directors had agreed that the board was currently too large, and it would be reduced to six following the resignation or retirement of two independent non-executive directors.
“The non-ASF directors are particularly concerned with the ASF proposal to remove the executive director - strategy and a further independent non-executive director from the board because of the potential consequences of these changes to the business and the board,” Mr Lenergan’s letter said.
“If implemented, these changes would reduce the board to four directors, two of whom are ASF nominees.”
Mr Lenergan asked shareholders to carefully consider their position when voting on the resolutions, which include the possibility of a spill motion following a possible vote against the company’s remuneration report.
Rey received its first strike on executive remuneration in November last year.
At 11:00AM, WST, Rey Resources shares were down 5.8 per cent, trading at 6.4 cents.
