Karelian shareholders to vote on proposal to sack chairman

Rebel group wants to oust Richard Conroy and four board colleagues

Under pressure: Rebel investors in the company want to oust Prof Conroy, above, his daughter Sorca Conroy, Séamus FitzPatrick, Maureen Jones and Louis J Maguire from the Karelian board and replace them with their own nominees. Photograph: Cyril Byrne

Under pressure: Rebel investors in the company want to oust Prof Conroy, above, his daughter Sorca Conroy, Séamus FitzPatrick, Maureen Jones and Louis J Maguire from the Karelian board and replace them with their own nominees. Photograph: Cyril Byrne

 

Karelian Diamond Resources shareholders will vote on proposals to sack chairman Richard Conroy and other directors at a meeting next month.

Rebel investors in the Irish company, which owns a diamond discovery in Lahtojoki, Finland, among other prospects, want to oust Prof Conroy, his daughter Sorca Conroy, Séamus FitzPatrick, Maureen Jones and Louis J Maguire from the board and replace them with their own nominees.

Karelian said on Thursday it would hold an extraordinary general meeting in Dublin on Friday July 26th to allow shareholders to vote on the proposals, but advised investors to reject them as they are not in the company’s best interest.

Shareholders Alan Osborne, Richie Taberner, Steve Coomber and Kevin Taylor say Prof Conroy and the other directors have taken €4.1 million of the €7.9 million that Karelian has raised in fees.

The rebels propose replacing the chairman and other directors with Mr Osborne, Mr Taylor and diamond-mining experts Stephen Grimmer and Martin Doyle.

The four, who own 17 per cent of the company, say that after 14 years of zero returns, Karelian’s backers face serious losses.

“It’s very clear there has been little to no progress to benefit shareholders – large amounts of money raised for development have instead gone on directors salaries,” they say.

Rejected

Prof Conroy recently rejected this, saying that the directors put €2 million into Karelian. A company statement says board members have invested €1 million more in the business than they have taken in fees.

Karelian’s statement pleads with shareholders to support the directors. “They have brought the company to this stage successfully and will now endeavour to bring about the development of a mine and a profitable company with a corresponding share price that will reflect that the board believes to be the true value of your company,” it says.

Prof Conroy’s opponents claim that Karelian’s share price – 7.5 pence sterling on London’s Alternative Investment Market before trading closed on Thursday – undervalues the company.

The board agrees that the price under values Karelian but argues that continued work on Lahtojoki and its other Finnish other prospects, such as Seitapera, should boost its stock.