New management as Guyana Goldfields to be sold to Silvercorp

…workers told not to worry, but Union questions severance

Aurora Goldmines in Region Seven (Cuyuni-Mazaruni), which is owned by Canadian company Guyana Goldfields, looks set to be taken over by new management after a multimillion-dollar deal to sell the mine and all shares in Guyana Goldfields was brokered.

In documents seen by this publication, Guyana Goldfields Chief Executive Officer, Alan Pangbourne announced that Silvercorp, another Canadian company with an international footprint, will be the new management.
According to the arrangement, Silvercorp will eventually acquire all issued Guyana Goldfields shares. The deal will be worth Canadian $105 million, but will be held up by a lot of paperwork and a special shareholders meeting scheduled for June.

In the meantime, Silvercorp, which specialised in silver and other metals, will be providing Goldfields with up to US$15 million in interim loans. This money will go to various corporate expenses, as well as the underground mine.
At a video conference meeting with Aurora Goldmine workers on Monday, Pangbourne assured them that they will keep their jobs and things will remain normal for now.
Pangbourne did admit that Goldfields is not completely aware of what Silvercorp, which has operations in China, has in mind for Aurora. However, he informed workers that the underground mine at the mining site will go forward for now.
“We’re not 100 per cent clear on all [Silvercorp’s] plans at the moment. Our current plans will continue as normal. I am in conversation with Silvercorp about what are their next steps and where they want to go and the focus is underground development.”
“[At a later stage] one of the other investors, they’re looking to do 30,000 metres of drilling once they can get their people in and back. When the Government opens up the airport,” Pangbourne explained to the workers.

Severance
But questions are being raised over severance for the workers, should management change hands. In an interview with this publication, National Mine Workers Union (NMWU) President, Sherwyn Downer raised questions about the arrangement.

When it comes to the workers, he stressed the need for them to be paid their severance once new management is taking over, even if they are retained. He cited past experiences where workers were denied severance after new management retained them.
“With respect to severance for workers, we’re going to make sure we apply the law and the books at AGM. We want to ensure the workers are paid their severance, because, in times past at two companies I will not name, workers were tricked and told they had their service rolled over to the new company,” Downer said.
“One year and six months after, when workers began resigning and they were asking for their previous years of service, the new company said they can’t pay them for those services because they weren’t working with them for that long, they were working with the old company. But when the old company pack up and gone, how will the workers get their severance?”
In a subsequent statement, the NMWU put Goldfields on blast for failing to consult the Union on what systems will be put in place for the workers.
“The management of AGM met with its workers during which they were informed of what the management termed as the transitioning of the company. During the meeting workers questioned if the Union had any knowledge about the decision and they were told that the Union did not have to know.”
“It is therefore regrettable that the management of AGM Inc would have found it unnecessary for the Union to be informed and involved in the said process. [We wish] to register [our] disappointment at the conduct of the management at this time and hope that there can be an amicable resolution between management and Union.”
Guyana Goldfields has had a roller coaster past year, with former CEO Scott Caldwell resigning and a shareholders’ dispute. They have also had to contend with workers striking due to concerns over their severance.