LEKOIL (AIM: LEK), the oil and gas exploration and production company with a focus on Nigeria and West Africa, has published its response to the received statement letter from the requisitioner, Metallon Corporation Limited (“Metallon”). This response statement will be posted to all shareholders in accordance with the articles of the Company.
The Company’s response statement is presented below and also available on: www.lekoil.com/corporate-documents.
THE BOARD HAS RESOLVED, EXCLUDING THE CHAIRMAN (FOR THE REASONS SET OUT IN THE CIRCULAR TO SHAREHOLDERS DATED 11 DECEMBER 2020) AND WITH ANTHONY HAWKINS DISSENTING, TO APPROVE THE FOLLOWING STATEMENT. THAT BEING THE CASE, ANTHONY HAWKINS DOES NOT SHARE IN THE BELIEFS OR OPINIONS IN RELATION TO THE REQUISITION OR THE REQUSITIONIST EXPRESSED HEREIN. ALL REFERENCES TO THE “BOARD” AND TO THE “COMPANY” CONTAINED HEREIN SHOULD, AS THE CONTEXT MAY REQUIRE, THEREFORE BE READ ACCORDINGLY.
Dear shareholders,
METALLON IS ATTEMPTING TO TAKE CONTROL OF YOUR COMPANY
As you will be aware, Metallon Corporation Limited (“Metallon”), a shareholder, has requisitioned an Extraordinary General Meeting and has issued a statement in support of its proposed resolutions.
The Company would like to take this opportunity to respond to that statement.
In summary, your Board believes:
Metallon’s arguments are specious and designed to distract from their true intentions.
Your Board has never been averse to considering the appointment of new Directors, with two new directors appointed in 2020. Indeed, your Board unanimously regards George Maxwell, with his extensive industry and country experience, as highly suitable and potentially a positive addition to the Board. Metallon was well aware, long before its requisition of an EGM, of the Company’s willingness to consider suitable board candidates such as Mr Maxwell. However, the appointment of one director would not achieve Metallon’s objectives.
The Board considers the Requisitioned Resolutions to be no more than an ill-disguised attempt by Metallon to gain control of your Company without paying a price to all shareholders that reflects the intrinsic value of the business and assets of the Company.
If all of the Requisitioned Resolutions are passed, Metallon’s appointees would represent 50% of the directors on the Board and, if Michael Ajukwu is elected Chairman, they will also have the casting vote. The Board does not believe that it would be appropriate for a c.15% shareholder, to enjoy that level of Board representation and control over the Company. Metallon has been a shareholder for less than six months.
The Board does not consider Metallon to be a fit or proper entity to determine the future of your Company.
Shareholders are urged to undertake their own due diligence on Metallon. Your Board has done so, and sets out below its major areas of significant concern.
In summary, your Board’s concerns centre on the violation of foreign exchange control regulations in Zimbabwe; winding-up petitions from several creditors leading to a winding up order of the High Court; the distressed state of Metallon’s gold mines in Zimbabwe; and the failure to remunerate employees – all of which are a matter of public record.
Your Board believes that Metallon has identified Lekoil’s assets as an opportunity to address its own financial challenges.
Set out below in Section One is a statement by the Company and in Section Two the Board provides a direct rebuttal of the Statement from Metallon announced by RNS and posted to the Company’s website on 17 December 2020.
Yours sincerely,
Aisha Oyebode
Independent Non-Executive Director
Source: LEKOIL