Business Day (Johannesburg)
Bheki Mpofu
4 November 2009
Johannesburg — THE board of junior miner Wesizwe Platinum has asked CEO Michael Solomon and chairman Robert Rainey to step down in yet another boardroom drama involving a mining company in less than two months.
Acting chairman Iraj Abedian would not be drawn on the reasons for the removal of Solomon and Rainey as the matter is now subject to a legal challenge.
However, a source close to the board said the decision was precipitated by tension over the "strategic direction" of the company.
Wesizwe said last week it was reviewing options for strategic direction and funding, giving rise to talk that it could be a takeover target of Impala Platinum ( Implats ), the world's second- largest producer of the metal.
Wesizwe's shares rose 5% yesterday on the speculation. Neither Implats nor Wesizwe, which is trading under a cautionary notice, could confirm the market talk.
The source said: "The matter is not related to the performance of the two or any case of impropriety, but the decision is fundamentally about board dynamics. Things got to a point that issues had to be resolved in this manner."
Last month a boardroom battle led to the ousting of Implats chairman Fred Roux after a "strained, distant" relationship with CEO David Brown and the board. Roux said at the time he would challenge his removal.
In September, five directors of another junior miner, Simmer & Jack, left due to tension between them and other board members.
Solomon would not be drawn yesterday on the reasons for his and Rainey's removal, due to the legal challenge. He said the decision was taken by four board members without consulting shareholders. "The move is therefore in bad faith and invalid."
Rainey, who is overseas, could not be reached for comment.
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