YBM mum on walkout by third legal team
By SANDRA RUBIN
The Financial Post
Friday, September 11, 1998
YBM Magnex International Inc. said yesterday it will hold a shareholders' meeting "as soon as possible" to confront institutional investors trying to remove the board. Meanwhile, it has offered them a seat at the directors' table.
But the company failed to disclose Bay Street law firm McCarthy T‚trault has quit, the third set of lawyers to walk out in under a month. It also failed to say the offer of a board seat was rejected a day before the statement was issued.
"One representative is not now, has never been and will never be good enough," said Wesley Voorheis, a shareholder adviser hired by Connor Clark & Lunn Investment Management, which owns about 16% of the company's stock.
Philadelphia-based YBM, under investigation as part of a U.S. federal organized crime probe, is now without major Canadian counsel and auditors. About $635 million in stock has been frozen by a cease-trade order since May 13.
Voorheis said he's pressing ahead with plans to force a special shareholders' meeting to install a new slate of directors.
"From our perspective, this is about getting control of our company - that's what this is all about," he said. "And we intend to do it."
Securities lawyer Ren‚ Sorell and a team from McCarthy were hired about three weeks after Joe Groia of Heenan Blaikie and Lawrence Wilder of Cassels Brock & Blackwell resigned.
Sorell, who doesn't talk to the media, was representing YBM in talks with Connor Clark in a bid to avoid a proxy battle. He quit Wednesday.
"This doesn't really change the course we're on," said Voorheis. "Why this could have happened so hard on the heels of prior counsel resigning is something you can speculate about.
"But it really doesn't change the fact there will be a shareholders' meeting. The shareholders will exercise their democratic right, and we'll see where that takes us."
YBM spokesman Guy Scala said the company plans to call the special meeting by late October or possibly in November.
"We're going through the procedures to establish the date of record," he said. "Once that's established I believe Canadian law says the meeting must be held anywhere from 35 to 60 days. We're trying to get it in as short a time as possible."
YBM did not want to comment on Voorheis's campaign to oust the board directors, he added.
"I know they're doing a lot of commenting in the press but I can't really comment. We were trying to work with them ... and we're still welcoming them on to the board."
He acknowledged the offer has already been rejected, but said "the invitation is still there."
YBM also declined to discuss why McCarthy T‚trault quit, saying it was covered by "client-counsel privilege."
YBM Magnex International, Inc. Announces Calling for Shareholders' Meeting
NEWTOWN, Pa., Sept. 10 /PRNewswire/ -- YBM Magnex International, Inc. (the "Company") announces today that, after several weeks of discussions and negotiations with VC & Co. Incorporated, and receipt of a requisition for a shareholders' meeting from the same firm, the Company will call for a shareholders' meeting to be held as soon as possible. The purpose of the meeting will be to elect a Board of Directors, and to update shareholders of the Company regarding the various issues currently facing the Company.
VC & Co. Incorporated had requisitioned a shareholders' meeting on behalf of institutional shareholders holding not less than 5% of the Company's common shares. The Company has invited one person, as the shareholders representative, to fill the existing vacancy on the Board and assist the Company with its preparation for the shareholders' meeting.
The Toronto Stock Exchange neither approves nor disapproves the information contained herein.
SOURCE YBM Magnex International, Inc.
CO: YBM Magnex International, Inc.; VC & Co. Incorporated
ST: Pennsylvania |
