The more I think about what has happened today, the more I'm pondering the different possibilities.
1. It would not surprise me to see ASX/ASIC decide to get involved. A chairman of a company dumping millions of FREE shares in the middle of a drilling campaign while trying to get some Chinese investors on board via a JV or offtake etc, is going to more than just raise a few eyebrows.
This 'please explain' from the ASX is just the first shot across the bow. I would not be surprised if we were suspended pending further inquiries.
2. How can Klaus remain Chairman of the company after effectively sinking the ship?? It only takes a request from 5% of existing shareholders to call an extra ordinary meeting to remove a director. Does anyone think there would be any difficulty in getting such a motion up??
I can't see how AVZ will have any respect from any quarter with Klaus remaining as a director. I'm very surprised he has not resigned already.
Klaus was the managing director of AVZ on a salary of ~$180,000/yr for 4 years before the Manono deal came along. When it was voted that he received 80M FREE shares for 'organising the deal', I was more than surprised. It was an aspect that made me keep my original shares last year for only a short time.
Isn't the salary of the MD the reward for getting deals done?? Why should extra shares be given for doing one's job?? It is something I'll definitely be more than wary of in the future, as those free shares have not only added to dilution, they have just kicked shareholders in the guts.
IMHO I don't think Klaus realises what a HUGE mistake he has just made over the last week.
AVZ Price at posting:
9.4¢ Sentiment: None Disclosure: Held
