05/09/2008 - 14:28

Portman ponders Golden West stake

05/09/2008 - 14:28

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Portman Ltd said it is assessing its options of its shareholding in Golden West Resources Ltd after a Federal Court judge today ruled against the validity of its proxy forms lodged for last week's extraordinary meeting.

Portman ponders Golden West stake

Portman Ltd said it is assessing its options of its shareholding in Golden West Resources Ltd after a Federal Court judge today ruled against the validity of its proxy forms lodged for last week's extraordinary meeting.

Portman today conceded defeat in its resolutions put forward to Golden West shareholders, including the replacement of two directors with its own managing director Richard Mehan and Paul Piercy.

In a statement, the company said it was "disappointed" the Federal Court ruled against its application to have its proxy forms, representing about 12 per cent of voting shares, declared valid.

At a shareholders meeting held last Friday, the proxies were ruled invalid, based on the proportion of shares Portman held in Golden West.

Portman disputed that, with the case then heading to the Federal Court where earlier this week the judge reserved his decision.

Golden West today released the results from the meeting, with each resolution sitting comfortably in the company's favour.

Other resolutions passed included options to non-executive director, John Lester, further share and option placements, and the acquisition of the Joyners Find tenements.

However Portman today said it took heart in knowing it received "considerable" support from shareholders who "shared Portman's concerns about the level of iron ore experience on the Golden West Board".

"It is clear there is an appetite to boost the iron ore expertise at the top strategic level of Golden West Resources," Mr Mehan said in a statement.

Portman also pointed out that a substantial share placement to a Chinese company completed days before the meeting was a "critical factor" in its defeat.

Last month, Golden West secured an off-take deal with Hunan Valin Steel Tube & Wire Co Ltd, which also subscribed to shares representing an 11.4 per cent stake.

Portman, which is 85 per cent controlled by US company Cleveland-Cliffs, currently holds a 19.2 per cent stake in Golden West and said today it was assessing its options in relation to the interest.

It has been an eventful past few months for both companies, starting in late June when Portman increased its shareholding in Golden West to 19.9 per cent and called for the removal of chairman Con Markopolous and director Michael Wilson.

Golden West responded by saying Portman wanted to seize control of the company without paying a premium.

Since then, both companies have been locked in a battle to win over stakeholders prior to last week's heated meeting, where a punch-up reportedly broke out between shareholders.

 

Below is a statement from Portman:

 

Portman Iron Ore Limited (Portman, ASX: PMM) is disappointed that, following last Friday's general meeting of Golden West Resources Limited (Golden West, ASX: GWR), resolutions for the appointment of Portman Managing Director, Mr Richard Mehan and independent director, Mr Paul Piercy to the Golden West Board were not passed.

Portman notes that the Federal Court today ruled against its application for validation of proxy forms lodged in support of Portman's positions on the resolutions, which represented approximately 12% of the voting shares.

Portman received considerable support from Golden West shareholders who shared Portman's concerns about the level of iron ore experience on the Golden West board.

"It is clear there is an appetite to boost the iron ore expertise at the top strategic level of Golden West Resources," Portman Managing Director Richard Mehan said.

Portman is also disappointed that the other resolutions proposed by Golden West in relation to options to non-executive director, John Lester, further share and option placements, and the acquisition of the Joyners Find tenements were also passed. Again, there was significant shareholder support for Portman's objections to these resolutions.

It is clear that the substantial share placement completed just days before the general meeting was a critical factor in defeating the position of Portman and many other shareholders.

Portman holds a 19.2% interest in Golden West and is currently assessing its options in relation to this investment.

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