Angry Shareholders Launch Proxy Fight at Iron Ore Development Company
03/04/2016 - There’s a proxy battle afoot at Canada’s New Millennium Iron Corp. as a group of shareholders, angry about the company’s direction and declining stock price, look to replace its board of directors, reports The Northern Miner trade newspaper.
According to the newspaper, the dissident shareholders are looking to install four new directors and remove two others by reducing the size of the board. A special shareholders meeting has been scheduled for 15 March.
The dissidents argue that the current board hasn’t done enough to preserve working capital and have destroyed shareholder value.
Based in Calgary, the iron ore development company is sitting on seven taconite properties in Canada’s Labrador Trough, which straddles the provinces of Quebec and Newfoundland and Labrador. In partnership with Tata Steel, the company also has developed a direct shipping ore facility, which is producing sinter fines. Tata owns approximately 26 percent of New Millennium and is its largest shareholder.
The dissident shareholders are led by Greg Chorny and Susan Milton. They and other members of the Milton family own 7 percent of the company, the newspaper said.
In a statement responding to a recent circular from the dissident shareholders, the company said the group has made misleading statements.
“In the face of difficult market conditions over the past two years, (New Millennium) has taken appropriate steps to balance its short- and long- term interests, including restructuring to preserve liquidity, board renewal and management team succession, and building on past investments to create a new strategy for monetizing the company’s taconite property assets in the Labrador Trough,” said independent director Howard Lutley.
“In attempting to stop this momentum, the dissidents are jeopardizing (New Millennium’s) future and reputation by failing to acknowledge the reality of project lead times in our industry and the need for maintaining relationships with prospective business partners, governments, First Nations and communities in general.”
The dissidents argue that the current board hasn’t done enough to preserve working capital and have destroyed shareholder value.
Based in Calgary, the iron ore development company is sitting on seven taconite properties in Canada’s Labrador Trough, which straddles the provinces of Quebec and Newfoundland and Labrador. In partnership with Tata Steel, the company also has developed a direct shipping ore facility, which is producing sinter fines. Tata owns approximately 26 percent of New Millennium and is its largest shareholder.
The dissident shareholders are led by Greg Chorny and Susan Milton. They and other members of the Milton family own 7 percent of the company, the newspaper said.
In a statement responding to a recent circular from the dissident shareholders, the company said the group has made misleading statements.
“In the face of difficult market conditions over the past two years, (New Millennium) has taken appropriate steps to balance its short- and long- term interests, including restructuring to preserve liquidity, board renewal and management team succession, and building on past investments to create a new strategy for monetizing the company’s taconite property assets in the Labrador Trough,” said independent director Howard Lutley.
“In attempting to stop this momentum, the dissidents are jeopardizing (New Millennium’s) future and reputation by failing to acknowledge the reality of project lead times in our industry and the need for maintaining relationships with prospective business partners, governments, First Nations and communities in general.”
