Hong Kong-based Ka An Development executes Eastplats board coup

TORONTO (miningweekly.com) – Hong Kong-based activist shareholder Ka An Development has succeeded in replacing the entire Eastern Platinum (Eastplats) board with its proposed slate of nominees during the company’s annual general meeting (AGM) held early on Tuesday.

Vancouver-based Eastplats reported that immediately following the AGM, the board held its first meeting of directors, during which it appointed financial services veteran George Dorin as chairperson.

Other management changes included Peter Clausi being appointed interim CEO of company; the executive committee being disbanded; Clausi being appointed as COO; and various committees of the board being reconstituted with the new incumbents.

Ka An had acquired a 13.79% stake in Eastplats in May and launched a proxy battle ahead of the AGM.

Eastplats had previously contended that the dissident shareholders, which included Toronto-based hedge fund K2 Principal Fund, were only interested in benefiting themselves by taking control of Eastplats’ assets and treasury, without paying other shareholders a premium for that control. In particular, Eastplats had asserted that none of the dissidents’ nominees had disclosed experience directly relevant to the mining of platinum in the volatile South African sector.

However, TSX- and JSE-listed Eastplats announced last week that it would sell its South African subsidiary Barplats Mines, which held the Crocodile River mine (CRM) to Chinese company Hebei Zhongheng Tianda Platinum for $50-million. As part of that agreement, it was required to buy out certain minority interests in its assets for $13.37-million.

Following the sale of Barplats and CRM to HZT, Eastplats would retain ownership of its eastern limb projects, including the Mareesburg, Spitzkop and Kennedy’s Vale projects.

Eastplats on Tuesday stated that the board would be carefully reviewing the company's current care-and-maintenance programme and its potential strategic alternatives, including the proposed sale of Barplats, which held the CRM.

The board expected to report “a number of material changes and developments” in the coming weeks and months, as its review of Eastplats progressed, the company advised.