Cornerstone Capital Resources Inc said on Wednesday it intends to urge SolGold Plc shareholders to replace the company’s entire board, a day after rejecting the London-listed miner’s takeover offer for the second time.
Cornerstone has an 8 per cent stake in SolGold, making it the BHP Group,-backed company’s fourth-biggest shareholder.
“The current SolGold Board is incapable of managing the affairs of SolGold for the benefit of all shareholders in a prudent and transparent manner,” said Greg Chamandy, chairman of Cornerstone, in a statement.
The proposed Franco-Nevada royalty financing will significantly destroy shareholder value for all SolGold shareholders, Chamandy added.
SolGold in May had announced a financing package of up to $150 million with streaming company Franco-Nevada Corp to develop its Alpala project, a copper-gold deposit in northern Ecuador.
The Canadian copper and gold miner said it expects the SolGold’s new board to carefully review the terms of the Franco-Nevada financing package and take appropriate action to terminate the deal if it is not in the best interests of SolGold and its shareholders.
SolGold made an all-stock transaction offer of 11 SolGold ordinary shares for each Cornerstone share late in June after its earlier proposal in 2019 was rejected on grounds that it undervalued the Canadian company.
Cornerstone said on Tuesday about 65 per cent of its shareholders would not support SolGold’s second offer.
SolGold did not immediately respond to Reuters request for comment. Shares of the London-listed jumped 5 per cent to 22.20 pence by 1139 GMT.
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