Minmet in negotiations over possible third-party takeover

EXPLORATION COMPANY Minmet has confirmed that it is in talks with a third party about a possible takeover of the company.

Last month the Irish Alternative Investment Market-listed Minmet announced that Mitre Oil & Gas Limited had acquired 19.76 per cent of the company's share capital after major shareholder Kevin Anderson sold his entire 16.4 per cent stake.

It could not be confirmed yesterday whether Mitre Oil & Gas, understood to be a privately owned UK company, was making the bid for Minmet. The latest discussions mark another turn in what has been an eventful and, at times, troubled year for Minmet.

On July 18th, chairman Peter Maddocks, chief executive Jonathan King and finance director Denis Barrett stepped down ahead of an extraordinary general meeting at which a group of rebel shareholders were seeking to have them removed.

However, the company said the three would continue to have operational roles.

Former chairman Michael Neville was reappointed executive chairman of the company, while John Liwosz, who was a former non-executive director, was also appointed to the board of the company as an executive director.

Activist shareholders had been seeking to have Thomas O'Gorman, Justin Ribbons and Thomas Anderson appointed to the board to replace Mr Maddocks, Mr King and Mr Barrett but withdrew the resolutions following the resignations.

The board had been under pressure to explain a series of deals involving companies associated with Mr Maddocks.

Concern had also been expressed about the company's dealings with Leslie Greyling, a convicted fraudster.

In April, a previous extraordinary general meeting was requisitioned by a group of shareholders who had raised questions relating to certain transactions by the company between August 2007 and January 2008.

Among the transactions were:

the payment of $4.35 million (€2.95 million) by way of refundable deposit to Carbon Energy Investments Ltd to secure the purchase of Alaska Oil & Gas Resources Ltd;

the payment of $6 million by way of refundable deposit to Tucumcari Investments Limited for an option to acquire Tucumcari Exploration;

the commitment of loans by Minmet totalling $3 million to be advanced to Tucumcari Exploration to fund essential expenditure to preserve the value of Tucumcari Exploration and its assets.

Shareholders had also queried cross-shareholdings by then Minmet chairman Mr Maddocks, who also had a 5 per cent beneficial interest in Carbon Energy Investments.

In a letter to shareholders, Minmet's board said the transaction between Carbon and Minmet did not constitute a related party transaction under the Alternative Investment Market rules because any commonality of either management or ownership between Carbon and Minmet was below the requisite threshold to give rise to a related party relationship under the rules. It also disclosed Mr Maddocks was the sole director and registered shareholder of Tucumcari Investments Limited. It said he held these shares in trust for a number of beneficiaries.