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Kingsgate suffers strike


Brian Robins

GOLDMINER Kingsgate Consolidated has suffered its ''first strike'' with more than a quarter of shares voted against its remuneration report at Wednesday's annual meeting. The vote paves the way for a spill of directors if repeated next year.

Kingsgate chairman Ross Smyth-Kirk said he was ''very disappointed'' with the vote, saying that although a proxy adviser had recommended voting against the report, ''it did not seek to speak with the company'' on the matter.

Earlier, Kingsgate was criticised by William Morgan, a portfolio manager with Intrinsic Investment Management, over a series of missteps.

''We are very disappointed with the company's performance,'' he said, especially with a share placement earlier in the year at $7.10, which helped to trigger a collapse in its share price. The stock closed on Wednesday at $4.85, down 7¢.

Mr Smyth-Kirk said the placement had been forced on the company due to prolonged delays in receiving permits for its Chatree North acreage in Thailand. Once Kingsgate was aware the delays could create a ''liquidity event'' it went to the market for $70 million via a placement.

''It had to be done quickly, and the position was likely to deteriorate further over the next 12 months,'' Mr Smyth-Kirk said.

Managing director Gavin Thomas told shareholders: ''The reason there are delays is I will not go to jail for you - I will not pay bribes. I will not pay the $120 million - that is the asking price [for a permit]. Thailand is better than some, but it is not an easy environment to operate in.''

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