RAPAPORT… Nearly a quarter of Gem Diamonds’ shareholders voted against
reelecting CEO Clifford Elphick to the company’s board, in an effort to force approval of share buybacks and dividends.
The board directors opposed implementing those measures because of the current weakness in the diamond market and the need to maintain appropriate cash reserves, the miner noted.
Although Elphick’s reelction passed, the miner spoke to the shareholders involved about their concerns.
“We understand that the significant votes received [are]
principally related to the board’s approach on share buybacks, dividends and
board composition,” Gem Diamonds said in a company filing following its annual general meeting last week.
A similar portion of shareholders also voted against retaining
board member Harry Kenyon-Slaney for another term.
Shares in Gem Diamonds fell 8% Friday following the
announcement, sending the stock to its lowest point this year.
Image: Clifford Elphick. (Gem Diamonds)
Gem Diamonds Firm on No-Dividend Policy
The Bottom Line
- Nearly 25% of shareholders opposed CEO Clifford Elphick’s re-election to pressure the company on share buybacks and dividends.
- The board rejected dividends and buybacks, citing market weakness and the need to preserve cash reserves.
- Gem Diamonds’ shares dropped 8% to their lowest level this year following the annual general meeting results.
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