“Change cannot wait”, say concerned Guyana Goldfields shareholders
…urge entity to hold meeting soon
The group of concerned shareholders of Canada-based Guyana Goldfields Inc, who has called for a shakeup of the company’s leadership over claims of poor performance and declining stock prices, is urging that the meeting requested over a week ago be held urgently.
Last week, the shareholders who together own not less than five per cent of the issued and outstanding shares of the company, announced that they have requisitioned a meeting for the purpose of reconstituting the entire Board with new experienced, accountable and qualified directors capable of fixing performance issues, leading a share price recovery and executing a value-maximising transaction. The ‘concerned shareholders’ also provided a list of nominees who they want to replace the current Board of Directors.
In a statement on Friday, the shareholders noted that under applicable rules, the Board must honour the request by calling a meeting within 21 days of the requisition. According to the shareholders, this meeting is urgently needed to halt dramatic value-destruction and improve the company’s performance. As such, they are urging the current Board of Directors to respect the rights of shareholders in the period before the requisitioned meeting.
Moreover, the shareholders are warning the Guyana Goldfields’ Board of Directors to refrain from self-serving or defensive actions that are detrimental to shareholders’ rights.
“Shareholders are telling us that they’ve had enough of the dramatic value-destruction that has occurred under the stewardship of this Board and are seeking a new path, with new Directors, who can turn things around. They share the concerned shareholders’ view that the longer it takes to change the Board, the worse things are going to get for shareholders,” said Patrick Sheridan, one of the largest shareholders and founder of the company.
In Friday’s missive, Sheridan, who is also a former Executive Chairman and former Director of Guyana Goldfields, expressed gratitude to other shareholders who
have reached out to express support for the ‘concerned shareholders’ Director nominees and related proposals.
“In just one week, the overwhelming support that we’ve received from shareholders who have contacted us is a testament to the strong desire for change at Guyana Goldfields. On top of this, and even more disconcerting, is the number of investors who have told me they have dumped their stock or that they won’t invest in Guyana Goldfields because they no longer trust the competency of the current Board,” Sheridan related in the statement.
To this end, the concerned shareholders are urging the Board to refrain from any self-serving or anti-shareholder defensive actions that inhibit shareholders’ ability to exercise their legal rights.
It was noted that the concerned shareholders have formally written the Toronto Stock Exchange, asking the body to monitor any proposal made by Guyana Goldfields for signs of entrenchment, shareholder dilution or attempts to structure around regulatory shareholder approval requirements.
According to Friday’s missive, the Guyana Goldfields has lost over CAD$1 billion in value since 2016 because of the Board’s operational failures, irresponsible actions and risky decisions. To add insult to injury, it added, while shareholders have lost over 80 per cent of their investment since 2016, the Board has continued to reward itself handsomely and has offered no plan to turn things around.
In contrast, the concerned shareholders said their nominees are putting forward a clear strategy to optimise operational performance, repair the relationship with the Government of Guyana, and turn the share price around and execute a value-maximising transaction.
“The Board has demonstrated an inability to stop the freefall of the Company’s share price. Enough is enough,” said Sheridan, adding that “We ask that the Board promptly set a meeting date and allow Guyana Goldfields’ shareholders the opportunity to determine the appropriate stewards of their company and save their investment.”
In its last performance review – 2018 third quarter operational and financial results in October – Guyana Goldfields reported its gold production guidance was revised downward to 150,000–55,000 ounces as grades have not rebounded as quickly as anticipated in the fourth quarter. This represents a reduction from the previous range of 175,000-185,000 ounces of gold. Consequently, cost of sales was also revised to US$1030-US$1055 per ounce and all-in sustaining costs of US$1025-US$1050 per ounce, and cash cost (before royalty) of US$660-US$685 per ounce for the year. Meanwhile, back in August, the Canadian mining company confirmed its intentions of laying off approximately 80 local workers in a bid to consolidate its operations. Aurora Gold Mines’ Public Relations Officer, Leon Roberts, had explained that the company would be focusing its operations at Aurora, located in Region Seven (Cuyuni-Mazaruni), thus cutting back operations from its Greenfield prospect, also located in Region Seven.
Guyana Goldfields’ Country Manager is Executive Member of the African Cultural and Development Association (ACDA), Violet Jean-Baptiste, while another ACDA Executive Member, Eric Phillips, is also a consultant with the Canadian-based mining company that is current facing the heat for its poor performance.