09/12/2008 - 11:02

Kalahari in bid to oust Extract chairman

09/12/2008 - 11:02

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Less than a month after the termination of a friendly merger, West Perth-based Kalahari Minerals has called for the chairman of Extract Resources to be removed.

Kalahari in bid to oust Extract chairman

Less than a month after the termination of a friendly merger, West Perth-based Kalahari Minerals has called for the chairman of Extract Resources to be removed.

London-listed Kalahari said Extract's non-executive chairman Robert Buchan had not delivered results from a strategy to build Extract's presence in the North American capital markets, where the company is listed on the Toronto stock exchange.

"The Board of Kalahari believes that unfortunately this strategy has not delivered results fro extract, with only a small number of Canadian shareholders being generated at a considerable cost," Kalahari said in a statement.

Kalahari holds a 39.05 per cent interest in Extract.

Kalahari said it had proposed Mr Buchan's removal following the merger termination last month, however because of the chairman's refusal, it had now requisitioned a meeting to put it to a shareholder vote.

"Kalahari also believes that the dual listing of Extract shares on the Toronto Stock Exchange should be terminated as it is not delivering any advantage for Extract shareholders and is an unnecessary cost at a time when all non-essential costs need to be eliminated," the company said.

"Kalahari believes that it no longer makes sense to have a Chairman located in North America."

Last month, Kalahari terminated the merger with Extract, saying it could not reach agreement with shareholder Rio Tinto therefore it would not be able to meet its obligations in the merger deal.

Meantime Extract has hit back at the requisition notice, saying if Mr Buchan was to be removed, the board will no longer have a majority of independent directors.

Kalahari has two of its directors on Extract's board.

"The Company has serious concerns that if Mr Buchan is removed as a director of the Company, the independent of the Board may be compromised," Extract said.

Extract said it is seeking legal advice in relation to the requisition notice.

 

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