Forbes & Manhattan Coal Corp. (TSX:FMC) announced the company’ stance regarding the tactics adopted by a group of dissident shareholders who wish to position the board members in order to make any future acquisitions advantageous to the dissidents.
As quoted in the press release:
Forbes Coal has made significant strides in implementing its turnaround strategy in the face of challenging conditions in the global coal industry.
Since acquiring the Magdalena and Aviemore Mines in September 2010, the current management and directors have:
- Increased saleable production by 74% by strategically expanding production from both mines;
- Positioned Forbes Coal for long-term export growth by expanding export capacity by 960,000 tonnes and by signing a three-year sales contract with a leading energy trading company for 1.75 million tonnes of thermal coal;
- More than doubled revenue from $46 million in fiscal 2011 to $105 million in 2012;
- Raised annual earnings before interest, taxes and depreciation (EBITDA) by 65% to $27.3 million in fiscal 2012;
- Improved social relations at both mines and dramatically reduced time lost to injuries;
- Raised over $75 million in equity and debt to acquire the assets and expand operations;
- Added research coverage from seven reputable brokerage firms in Canada and South Africa;
- Listed Forbes Coal on the Toronto Stock Exchange and the Johannesburg Stock Exchange.
Forbes Coal now has a strong balance sheet, with cash reserves of $8.1 million, providing more than sufficient working capital to meet present growth objectives.
Stephan Theron, Forbes Coal’s chief executive officer, commented:
Forbes Coal’s record speaks for itself. We have made great progress in our turnaround strategy at our two South African mines, and we have met all key operational and financial targets.
The dissidents have failed to demonstrate that the current board and management have not effectively executed Forbes Coal’s strategy. Even so, we have gone out of our way to accommodate their concerns. But their recent actions point to an ill-disguised attempt to position the board of Forbes Coal in a manner that is advantageous to them in an effort to potentially gain control of Forbes Coal in the future without paying the premium normally associated with an acquisition.