ISS recommends shareholders vote for incumbent Eastplats board

TORONTO (miningweekly.com) – Eastern Platinum (Eastplats) has reported that independent proxy advisory firm Institutional Shareholder Services (ISS) had recommended that shareholders vote to keep the incumbent Eastplats board, amid a heated proxy contest.

Hong Kong-based company Ka An Development, which had acquired a 13.79% stake in Eastplats in May, intended to nominate six new directors to replace the incumbent board members at a shareholder meeting in July.

According to an Eastplats statement, ISS made its recommendation after carefully reviewing the public record and took note that one and possibly two dissidents had said they may contest the election. As neither of the dissidents had filed a definitive dissident proxy to date, ISS did not comment on the dissidents.

Eastplats believed the dissidents’ nominees were not as qualified as the incumbent board of directors amid a challenging market for platinum. In particular, Eastplats said, none of the dissidents’ nominees had disclosed experience directly relevant to the mining of platinum in South Africa.

According to Eastplats, the incumbent board had a significant investment in Eastplats, coupled with extensive experience in the often-boisterous South African platinum market and Eastplats' South African platinum mining business.

It further contended that the company’s shares had traded in a narrow band despite lower platinum group metal prices, mainly owing to the board’s strategic decision three years ago to place the company’s main flagship Crocodile River mine, in South Africa’s North West province, on care and maintenance.

A proposed $225-million sale of its platinum business to China-based Hebei Zhongbo Platinum fell through late last year, reportedly owing to red tape, as a shareholder dispute at Hebei prevented the deal from closing.