Hello Jimmy
Nice % gain on the market today. Perhaps our booth at the Diamond Show made some converts. Speaking of the show, did anyone go?
Got anything to tell us?
This was on the SUF web site today:
SouthernEra Resources is pleased to announce the following three items:
The dewatering of the Messina shaft has begun
The Toronto office address will be changing, effective June 29, 2000 to:
111 Richmond Street West,
Suite 1002,
Toronto, Ontario
M5H 2G4
Telephone and fax numbers remain unchanged at (416) 359-9282 and 359-9141 respectively.
SouthernEra will have a booth again today, June 20, at the World Diamond Conference at the Four Seasons Hotel in Toronto
From The Northern Miner
June 12-18, 2000 issue
SouthernEra shuffles its board
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In another surprise twist at SouthernEra Resources (SUF-T), shareholders have replaced nearly their entire board of directors.
Taking the place of Lee Barker, Oliver Lennox-King, Patrick Ryan, Patrick McCulloch and Norman Hardie are James Anthony, Rudi Fronk, Vahid Fathi, Louis Fox and Philip Martin, the first four of whom also sit on the board of Seabridge Resources (SEA-V). Christopher Jennings and Patrick Evans, both management nominees, retained their seats.
"I've never before seen so many shareholders show up with their proxies to vote at an annual meeting," says Fronk. "I think shareholders were expecting significant changes with the new president [Steve Banning] and when the information circular came out, there was, needless to say, a great deal of disappointment."
Banning replaced Jennings as President earlier this year and followed this by appointing other subordinates. Though the shake-up was expected, what came as a surprise was a proposed relocation of the company's head office to Denver. The new board has since quashed that proposal, but whether it will do the same to the new management is too early to say: "This is a two-way evaluation," says Fronk, "in that Banning accepted the job from a board that's no longer there and we came in not knowing whether he's the right guy for the job."
As for the Seabridge connection, Fronk chalks this up to coincidence. He stressed that, when initially approached by Jennings, the inclusion of Fathi and Fox made sense in that both are experienced in the platinum market and can interest retail investors, while at the same time facilitating negotiations to finance the advanced Messina platinum project in South Africa.
Through Messina Platinum, a South African-listed company in which it owns a 70.4%-equity stake, SouthernEra is redeveloping the Voorspoed section of the mine, one of two briefly developed by Impala Platinum in the late 1980s. It was Impala that sold SouthernEra its initial interest, since raised to the current amount.
Reserves are pegged at 11.1 million tonnes grading 6.85 grams PGM plus gold per tonne, plus nickel and copper. The reserve lies within 575 metres of surface and is part of a global resource, to the 1,000-metre level, of 21.2 million tonnes grading 6.85 grams precious metals.
This year's program will entail shaft de-watering, stope development and reserve sampling. Funding will come out Messina's existing cash, though financing is necessary to cover the estimated life-of-mine capital costs of US$86 million.
Annual production is pegged at 159,000 oz. PGM plus gold, of which 44% will be platinum and 34% palladium, and operating costs ring in at US$150 per oz. precious metals, net of base metal credits.
Assuming all goes well, starting in 2003, 80,000 tonnes will be mined monthly to yield high-and low-grade concentrates. The concentrates would then be shipped, in slurry form, to Impala's smelter, near Rustenburg, for further processing.
At the meeting, shareholders also voted down a proposed amendment to the company's stock option plan. The new proposal would have essentially allowed for more options to be granted and their exercise price to fluctuate with the market.
From theMININGWEB.com in South Africa
SouthernEra's management ousted in shareholder coup
A shareholder-orchestrated coup d'etat has muddied the future of troubled diamond producer SouthernEra Resources with newly elected chief executive, Steven Banning, ousted from the group after only several months on the job.
At a raucous, three-hour general meeting on June 6, SouthernEra's newly-appointed management team were stunned by a surprise bid to overhaul the Toronto company's board of directors.
"Many (management) decisions in the past have had a negative impact on the company," said John Sabine, a Toronto lawyer that owns 28 000 common shares, to the applause of many investors.
When the smoke cleared three hours later, six of the company's eight directors were gone. Only two directors survived the rout: Christopher Jennings, company founder, and Patrick Evans, a South African-based executive with gold giant Placer Dome.
To add insult to injury, a proposal to sweeten management's stock option plan was turned down by investors. A controversial plan to move the company's headquarters to Denver was immediately axed by the new board.
Bay Street can expect more dramatic changes to come. The new board spent June 7 in closed-door meetings with management. Not surprisingly, sources indicate discussions did not go well and changes in the executive office may be in the works.
"We are now evaluating senior management," said Rudi Fronk, a newly-appointed director. "Senior management has to make the decision do they want to work with the new board and the board has to make the decision and evaluation are these the right people to move the company forward."
Investors hopeful of a turnaround
Investors are hopeful the power shuffle will result in a change in fortunes for SouthernEra. The company is best known for its battle two years ago with De Beers Consolidated Mines over the small Marsfontein diamond mine in South Africa. SouthernEra lost the fight, walking away with only 40 per cent of the small deposit.
Cash has been used to finance a slew of exploration projects around the world that have to date proven largely unsuccessful. The company has also pumped money into a number of African ventures, including acquiring 70 per cent of Messina, a proposed platinum and palladium mine, also in South Africa.
The catch is it will cost an estimated $70-million to get Messina off the ground. The company has only $9-million in the bank. To make matter worse, Marsfontein, the company's sole cash generator, will be depleted in August.
The company's share price has gone into a freefall. Shares slumped to a recent 52-week low of C$1.19, an 80 per cent decline from a 52-week high one year ago of C$5.50. Only three years ago, shares were worth C$20.50 each.
In March, a new management team was brought in to right the sinking ship, a move that proved extremely unpopular among investors. New chief executive Steven Banning's plan to tap into US equity markets via a US base of operations was widely viewed as insensitive to the company's strong Canadian roots.
SouthernEra stands by Messina platinum project
David McKay reports that SouthernEra is standing by its newly acquired stake in the Messina Platinum project.
Patrick Evans said that the decision to move into platinum would be accelerated but the future of management hung in the balance. Nno-one can consider themselves safe following the departure of Banning. Earlier Evans said: "Mr Banning is still an executive of the company, but his future depends on his ability to implement the clearly expressed wishes of shareholders and the new board will then determine".
Commenting on the shareholder coup, Evans said: "This is the first time in Canadian corporate history that large and small shareholders have stood together to boot out management. It is quite refreshing".
Meanwhile, analysts remained sceptical of the new team's track record of success. Banning and the bulk of his appointees held key management positions at Pegasus Gold, a high-cost Washington State-based gold producer that went bust in 1998.
Analysts are closely monitoring developments with a mix of horror and amusement. The challenges are immense but it's agreed the new board appears to be more street savvy than its predecessors.
Nevertheless, there are nagging concerns. Fronk and a handful of new directors have close ties to Seabridge Resources, the successor of Greenstone Resources, a Toronto exploration junior that ran into a mess of political and financial trouble in Central America.
In addition, Jennings, SouthernEra's former president and the man widely viewed as having got the company into its fine mess, remains on the board, perhaps for sentimental reasons.
However, Evans said the shareholder coup was prompted by a desire to have Jennings returned to the company's board. Jennings played a major role in discovering the diamond fields in Canada's resource-rich North West Territories.
By: Keith Damsell
There is also a very interesting Messina Slide Show dated May 31st under Product Marketing.
I think there has been more updated information posted on the SUF web site in the past two weeks than has been posted in the last four years!
Regards |
