A METAL miner chaired by former England cricket and Majestic Wine supremo Giles Clarke today issued a blistering attack on one of its biggest investors.
Ironveld, an Aim listed iron and magnesium miner, is accusing Richard Jennings of Align Research of conducting a campaign of “bullying, threats and coercion”.
A statement to the stock market today reveals that Jennings, a 9% shareholder, has issued a requisition notice calling for a general meeting to remove Clarke, the chairman, and CEO Martin Eales.
Ironveld says that Align Research operates by selling a promotional research product to smaller companies, taking a shareholding as part of his research compensation and then typically offering other ‘funding services’ to those companies.
When those services are declined, he becomes aggressive and agitates to remove the executives, they say.
Clarke said: “The Directors of Ironveld genuinely feel that they have been subjected to coercion, threats and bullying by Mr Jennings over many months. The Board and I have taken the unanimous decision that this type of behaviour cannot and will not be tolerated.”
He added that: “The Board considers resolutions proposed by Mr Jennings to be vexatious, self-serving and linked to a number of commercial proposals Mr Jennings has put to the company.”
Jennings said in response: “This is nothing less than I expected from Mr Clarke. I will be making a fulsome and robust response, correcting the untruths and scurrilous comments.”
He accused Clarke of “character assassination”, adding “I learnt how to stand up to bullies years ago”.
Ironveld, which has a market cap of about £5 million, plans to raise £4 million from investors at 0.3p a share to help it buy up a mothballed Ferrochrome Furnaces business in South Africa.
Jennings has made a series of funding offers to Ironveld, which it says were insufficient and overly complicated warrant deals.
Clarke, who built Majestic Wine into a national chain and founded PetCity, was chairman of the England and Wales Cricket Board (ECB) for seven years to 2015.
He says that standing up to Jennings has become a matter of principle. Small firms struggle to get broker coverage, which in turn makes it hard for them to raise cash from investors.
That leaves them at risk from firms such as Align he says, to whom Ironveld has paid tens of thousands of pounds for research.
A statement to the stock market said: “Richard Jennings has put to the Board a number of funding proposals in recent months which have been considered and rejected out of hand by all Directors. It is the Board’s view that these proposals, which include expensive debt and highly dilutive warrants would suit Mr Jennings very well, but would be to the detriment of the Company’s shareholders and the Company itself. Shareholders should recognise that Mr Jennings’ proposals are not in their best interests or those of the Company’s wider stakeholders, in particular its South African partners who are essential to the Company’s activities, and we therefore recommend shareholders to vote against Mr Jennings’ resolutions."
