Board control at Murchison Metals is set to pass to corporate raider Sir Ron Brierley’s Mercantile Investment Company, after the incumbenet chairman and managing director said all parties agreed on the need to return cash to shareholders.
Mercantile, which is Murchison’s largest shareholder with a 17 per cent stake, had requisitioned a meeting of shareholders to replace chairman Ken Scott-Mackenzie and managing director Greg Martin with a pair of its own nominees earlier this week.
Murchison said that following enquiries, Sir Ron had confirmed that MVT “strongly supports cash distributions to shareholders as soon as possible”.
As a result, Mr Scott-Mackenzie and Mr Martin have agreed to resign from the company’s board following its annual meeting on November 29.
“Following the return of over $207 million to shareholders in September, and Sir Ron’s confirmation that MVT is committed to the return of the company’s remaining funds, Greg and I are happy to step down as directors and to implement an orderly transition to MVT’s nominees,” Mr Scott-Mackenzie said in a statement.
“We are both very proud of our achievements over the last 18 months or so.
“Shortly after we became involved at Murchison, it became apparent the company had to overcome some significant challenges to preserve even modest shareholder value, and indeed survive.
“Careful strategic planning and a lot of very hard work culminated in the transaction with Mitsubishi that realised approximately $325 million for shareholders.”
Mr Scott-Mackenzie also hit back at suggestions that directors had delayed winding up Murchison’s affairs for personal gain, calling them “incorrect and defamatory”.
According to media reports, Sir Ron is understood to have raised concerns that Murchison’s projected expenses of $7.64 million to be spent before it is wound up was “grossly excessive”.
“As has been consistently reinforced to shareholders, under the terms of the agreement with Mitsubishi, the company cannot be wound up until February 2013, and the remaining staff have been working very hard to ensure that the maximum amount of cash can be distributed to shareholders as soon as practicable after this time.”
At close of trade today, Murchison’s stock was down 2.4 per cent, trading at 4 cents.
