Wednesday 21st September 2011
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An annual meeting showdown looms between two directors of Claridge Capital and an activist shareholder.
Substantial shareholder Flinders Holdings (FHL), controlled by investment banker John Sorensen, has put forward resolutions to dump chairman Evan Davies and independent director Roger Gower, and replace them with accountant Donald Gibson and Brett Wilkinson.
In recent months, Sorensen, who owns 9% of Claridge Capital, put forward a proposal to the board for a reverse takeover opportunity, which was ultimately turned down.
Sorensen is an investment banker who specialises in backdoor listings, and has had a hand in New Image Group and Plus SMS Holdings.
“The majority of the board (namely Roger Gower and me) do not believe that further reverse listings of CLA are in the best interests of CLA or of its shareholders,” Davies said in a letter to investors. “Roger Gower and I believe our removal is sought by FHL because of our preference not to pursue a reverse takeover based strategy.”
Claridge has undergone several changes over the year, including Regal Salmon, AQL Holdings, and Certified Organics to name a few. The shares last traded at 0.7 cents apiece on Aug. 19, valuing the company at just $1.8 million. Most recently, it bought Hyperfactory sister company Agent M Group.
Davies said he and fellow director Gower said the previous strategy to use the company to “recapitalise and float either a new technology or business idea through a back door listing” generally caused “severe equity dilution” and ensured the new business would fail.
Claridge Capital’s new strategy is to focus on finding new investment opportunities, such as the recent acquisition of mobile media network and analytics firm Snakk Media. Davies said fellow director Sean Joyce, who doesn’t face dumping, will take reverse listing transactions on a case-by-case basis. Sorensen’s involvement in Claridge Capital dates back to the original deal creating Certified Organics when he grabbed some 19% as some kind of success fee, selling down to less than 5% by the middle of 2002.
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