Vulisango rejects new Simmers board
JOHANNESBURG - Disgruntled Simmer & Jack Mines (Simmers) empowerment partner Vulisango on Monday rejected the new interim Simmers board.
The JSE-listed Simmers last week announced Theba chairperson Vusi Khanyile as its new nonexecutive chair and Deon van der Mescht as CEO, both with immediate effect, Khanyile replacing Nigel Brunette and Van der Mescht replacing Gordon Miller.
Both Miller and Brunette have been under pressure to step down from Vulisango, Simmers announcing their resignations in December, but indicating that both would not relinquish their positions as chairperson and CEO of TSX-listed First Uranium.
"This move signifies the formal separation of Simmers and First Uranium. While the dual roles of chairperson and CEO served us well during the crucial development years, the time had come to separate the responsibilities," said Brunette.
John Berry would also move off the Simmers board in order to focus on First Uranium, in which Simmers has a 37% shareholding.
Ralph Havenstein, Colin Brayshaw, Sindi Koyana, Adrian Meyer and Nick Segal have been appointed as interim independent nonexecutive directors and Van der Mescht and CFO Gerhard Jacobs executive directors.
Vulisango condemned the pre-February 1 general meeting appointments as an "erosion of shareholders' democratic rights".
The empowerment company said that the exiting of Brunette, Miller and Berry have pre-empted a legitimate process, without the support of the major shareholders.
The newcomers, Vulisango added, were seriously compromised in terms of "this flawed" appointment process and created the impression that the new board had been legitimately appointed in accordance with shareholder scrutiny and election.
"This is a deliberate attempt to constrain the process of ushering in a duly elected and credible board as proposed by significant shareholders and supported by ourselves, at the forthcoming general meeting," Vulisango CEO Valence Watson commented.
Vulisango described First Uranium as one of Simmers' most valuable assets. It noted, however, that First Uranium was experiencing "serious cash flow, performance and compliance issues".
One of the key performance areas of the new Simmers board would be to consider First Uranium's turnaround options.
Given that the method of appointing the new board was tantamount to setting up a surrogate structure for First Uranium, the new board could not be expected to hold those that appointed them properly accountable for performance and compliance.
Watson said that the exiting management from Simmers were using First Uranium as a sanctuary and buying time that would enable them to execute further value-destructive schemes.
The board proposed by "significant shareholders" as well as Vulisango had the mining and corporate experience to correct the operational performance, reduce costs and to restore shareholder confidence.
Those proposed included former Harmony Gold CEO Bernard Swanepoel as nonexecutive chairperson; and Implats' CEO David Brown, Aquarius CEO Stuart Murray, former Africa Rainbow Minerals coal division executive William Osae, former Iscor, Harmony and Rand Uranium dealmaker De Wet Schutte and Nampak and Freeworld Coatings' Peter Surgey as independent nonexecutive directors.
Vulisango intends to proceed with voting in its board nominees in order, it said, to put the company on a new path that unlocks value and ensures compliance.
