ENRC Risks Losing Managers, Hampering Search for CEO, Director Judge Says

ENRC Risks Losing Managers, Hampering Search for CEO, Director Judge Says

Eurasian Natural Resources Corp., a miner of metals in Kazakhstan, risks hampering its search for a chief executive officer and losing managers should it fail to resolve board conflicts, independent director Paul Judge said, Bloomberg reported.

"The current uncertainty about the board's future format must unfortunately increase the risk of other senior managers leaving," Judge said in an e-mailed response to questions yesterday. "It also means that it is more difficult to assemble a good short-list of potential chief executives."

ENRC is down 22 percent this year in London, compared with a 2.6 percent gain in the FTSE 100 Index of U.K. stocks, after a spate of management reshuffles beginning when then-CEO Johannes Sittard took over as chairman in August 2009. Felix Vulis became the new CEO only to submit his own resignation on Feb. 4, 2011. He remains in the post while the company seeks a replacement.

The situation deteriorated on June 8 as shareholders voted against rehiring independent directors Richard Sykes and Kenneth Olisa, while two other directors also left and ENRC set up a review to restructure the board. On June 13, Company Secretary and General Legal Counsel Randall Barker quit.

"We shall be announcing our half-year results in mid- August and I would hope that this governance review will be completed by then," Judge said. The review will probably follow the recommendations of the Institute of Chartered Secretaries and Administrators, a corporate-governance adviser, he said.

Genesis of Dispute

ENRC, based in London, said June 16 Sittard will "serve at the pleasure of the board" after the Daily Telegraph reported the same day that the ICSA recommended he step down as chairman.

Arguments between independent board members and the main shareholders followed Sittard becoming chairman, Olisa said in a July 1 interview. The dispute worsened with ENRC's purchase in 2010 of a tailings-project license in the Democratic Republic of Congo that was claimed by First Quantum Minerals Ltd. (FM), he said.

First Quantum, pursuing an arbitration case against Congo for revoking the Kolwezi license in August 2009, has submitted a complaint against ENRC to the U.K. Financial Services Authority and is suing ENRC subsidiaries in the British Virgin Islands.

ENRC's lawyers advised the board the license was legally canceled and transferred to companies affiliated with Israeli investor Dan Gertler by Congo, while a suit by First Quantum was likely, said Judge, who voted against the deal.

'Reputational Risk'

"On the scale of ENRC, it was a small acquisition and I felt that it was not worth the reputational risk or the likely diversion of management time," he said.

ENRC, which produces ferroalloys, iron ore, aluminum and power in Kazakhstan, and mines copper and cobalt in Congo, paid $175 million and provided a $400 million loan facility to companies affiliated with Gertler as part of the transaction.

ENRC required Gertler to sign a letter saying he wasn't involved in the loss of First Quantum's license, Judge said.

The company's corporate governance review, led by Sittard and announced at the annual general meeting, is proceeding on schedule and is due to be completed "by the end of the summer," said Charlotte Kirkham, a spokeswoman for ENRC.

"There is no change to this timetable and in the meantime the views of stakeholders from every relevant constituency, including of course those of Sir Paul, are being solicited and will be taken into account with a view to arriving at the right size and structure of the Board to support the Group's next phase of growth whilst fully complying with the governance code," Kirkham said.

Uzbekistan introduces recycling fees for cars
Uzbekistan introduces recycling fees for cars
China opens new transport corridor to Uzbekistan
China opens new transport corridor to Uzbekistan
Oversized goods transportation launched to Kazakhstan's Karachaganak
Oversized goods transportation launched to Kazakhstan's Karachaganak
Loading Bars
China would make a coronavirus vaccine a 'global public good'
One more coronavirus death, fewer new cases confirmed in Spain
China reports six new COVID-19 cases, five asymptomatic cases
Telegram messenger restores service after connection issues
UK anti-racism protesters clash with mounted police
Malta accepts over 420 migrants after 40 days at sea
WHO reports single-day increase in coronavirus cases by over 128,000
Hungary, Germany to lift travel restrictions to each other's citizens
Mexico restates commitment to April accord after OPEC+ talks
Afghan gun battle kills 9 militants in eastern Kunar province
Azerbaijan supports extension of OPEC+ deal
OPEC agrees to further extend production cuts
Hundreds of Lebanese join anti-government protests as lockdown eased
Bolsonaro threatens to withdraw Brazil from WHO
Iraq renews its commitment to OPEC+ deal
UK coronavirus death toll rises by 204 to 40,465
Azerbaijan confirms 379 new COVID-19 cases
OPEC, Russia to extend record oil cuts to end of July
Volume of issued mortgage loans increases in Azerbaijan
Deposit liabilities of Georgia's banking system decrease
Uzbekistan, China may set up joint venture for bearing production
Pros and cons of Iran’s new car presale lottery plan
Azerbaijani Central Bank's foreign exchange reserves grow
What to expect from OPEC+ meeting today
Georgia makes changes to Produce in Georgia program
Uzbekistan exports wild cherry to China
Uzbekistan introduces recycling fees for cars
Prices for Iran's petrochemical products down
Iran to supply support packages to population until COVID-19 is curbed
Tires, special vehicles manufacturing launch underway in Kazakhstan's Karaganda
Georgia's Medifari company plans to export facemasks to Israel, Russia, Belgium
Azerbaijan's Pasha Capital - leader in volume of operations on Baku Stock Exchange
Kazakhstan to manufacture petrocemical products from coal
EBRD, TBC Bank implement two mega-center projects in Georgia
Azerbaijani oil prices show mixed change
DHL resumes its operations in Turkmenistan
Azerbajan expanding broadband internet in regions
Turkmenistan to lock deals with foreign companies to buy pest control chemicals
China opens new transport corridor to Uzbekistan
Weekly review of Azerbaijan's precious metals market (May 29-June 5)
Georgia reduces electricity consumption during coronavirus
Pomegranate crop in Azerbaijan surpasses last year's yield
Oversized goods transportation launched to Kazakhstan's Karachaganak
Construction materials export from Uzbek Samarkand region increase
Georgia, Romania eye to boost cooperation opportunities in Black Sea region
Weekly review of Azerbaijani currency market
Baku Higher Oil School to hold online I International Scientific Conferences of Students and Young Researchers
Philippines confirms 7 new coronavirus deaths, 714 more cases
Romania, Georgia work on resuming Constanta - Poti / Batumi ferry connection
Corporate securities transactions rise in Azerbaijan
Wheat harvest kicks off in some regions of Turkmenistan
Georgian municipality predicts potato harvest for this season
How COVID-19 impacts Georgian fuel market?
Kazakhstan's uranium processing venture to buy equipment spare pars via tender
Coronavirus cases up in Georgia
Turkmenistan, Russia set measures to boost co-op in construction sector
Data on petroleum, chemical products manufacturing in Azerbaijan disclosed
China reports three new COVID-19 cases, two asymptomatic cases
Minister: Germany supports Georgia in economic development
Germany's confirmed coronavirus cases rise by 407 to 183,678
Turkmenistan, France discuss trade, economic cooperation
Capex on offshore wind to surpass upstream spending in Europe in 2022
Kazakhstan’s Atyrau refinery opens tender for radio system modernization
Turkey's export to OIC member states shrinks
Transactions on public securities on Azerbaijan's primary market down
Armenia violates ceasefire with Azerbaijan 24 times
Iran's historical cities suffer from lack of foreign tourists, thanks to COVID-19
Georgia's engineering firm Kaya offers additional services
Iranian trucks with goods enter Turkey, following months of closure
Iran plans to transfer gas from Kish field to feed South Pars refinery
Georgia expects rich hazelnut harvest
Thailand reports two new coronavirus cases, no new deaths
Iran to create holdings to control rental houses, apartments
FAO, Azerbaijan to develop new program
Kyrgyzstan reports 38 new COVID - 19 cases, 1974 in total
6.2-magnitude quake hits Kazakhstan -- local department
Bolsonaro threatens to withdraw Brazil from WHO
Small plane crash in U.S. state of Georgia kills 5
S. Korea reports 51 new virus cases, most in 8 days
Chinese mainland reports no new domestically transmitted COVID-19 cases
Chile reports 122,499 COVID-19 cases with 1,448 deaths
Head of Al-Qaida in Islamic Maghreb killed in Mali by French forces: minister
Street near White House renamed ‘Black Lives Matter Plaza’ — mayor
58 more coronavirus patients die in Moscow in past day — crisis center
Some 41,500 National Guard officers on duty in US amid protests
WHO recommends wider use of face masks to curb COVID-19
Facebook says it found no foreign interference targeting U.S. protests
Trudeau takes a knee at anti-racism protest on Parliament Hill
Trump orders 9,500 US troops to leave Germany
Finland's finance minister steps down over training payments
5.2-magnitude quake jolts eastern Turkey
EU countries agree on coordinated, non-discriminatory lifting of travel ban
Turkey: Daily coronavirus recoveries up with over 1,600
UK COVID-19 deaths top 40,000 as another 357 patients die
ADB eyeing agreement signing on road reconstruction in Kazakhstan
Azerbaijan discloses number of coronavirus tests
Italy's COVID-19 death toll up 85 to 33,774
Tourists from Israel may be among first visitors to Georgia
Agent bank of two more liquidated banks chosen in Azerbaijan
Azerbaijan plans to increase Virginia tobacco production
All news