If this proceeds any further I suggest we get a hotcopper collective together to fight this off. Similar to what PLS did last year. Absolutely ridiculous.
Read more: http://www.copyright link/brand/cha...nerals-takeover-20160616-gpkz55#ixzz4XreM9LZX
Follow us: @FinancialReview on Twitter | financialreview on Facebook
Australian shareholder activism broke new ground this week when OzBlue and SuperNinja organised a big position on the share register of lithium mining and exploration company Pilbara Minerals.
Normally, activism is the preserve of specialist funds or aggressive institutional fund managers taking long or short positions in a stock.
The big funds either go public with bold demands or put pressure on management behind closed doors in order to lift shareholder returns.
OzBlue and SuperNinja, which are the chat room nicknames of Bill Lambert and Michael Langford, have turned this concept on its head.
Through the combined power of email communications and the HotCopper chat room, which is used by day traders, Lambert and Langford have marshalled the forces of about 400 small shareholders, who own about 25 per cent of Pilbara Minerals.
They followed that up with the lodgement this week of a substantial shareholder notice for 5.8 per cent of the issued capital or 68.87 million shares worth $40 million.
The shareholder notice lists the nature of the relevant interest in Pilbara Minerals as "association of like-minded holders". An annex attached to the notice lists the names and holdings of about 50 shareholders in Pilbara Minerals.
But an activist investor at a major fund in Sydney said the shareholder notice was not a legal document even though it was in keeping with guidelines issued by the regulator.
He said the substantial shareholder notice should set out the legal agreement between the parties acting in concert and their objectives.
'Against cheap takeover'
Lambert owns 1.17 million shares, while Langford, a former CNBC presenter, owns 4.7 million.
Most of the shareholders are sitting on huge profits thanks to the fivefold increase in the Pilbara Minerals share price over the past 12 months. One holder, Pascale Bevilacqua, owns 20 million shares worth $12.5 million.
Pilbara Minerals has been swept up in the global mania for lithium stocks. It is developing the 100 per cent owned Pilgangoora lithium-tantalum project, 120 kms south of Port Hedland.
It is the world's second largest spodumene resource, which holds out the prospect of being a long term, low cost supplier of lithium.
Lambert says there are no immediate complaints from the group of like-minded shareholders about the performance of Pilbara Minerals management, which is led by former Atlas Iron CEO Ken Brinsden.
Since Brinsden took over as CEO in January, Pilbara Minerals has raised $100 million through an $85 million institutional placement and $15 million share purchase plan. This brought a range of institutional investors from Australia, the United Kingdom and the United States onto the register.
Lambert says recent takeover speculation had small shareholders worried about the company's future.
"We are deadset against any cheap takeover," he says.
"We just want the profits from this mine to flow to Australians over the next five to 10 years.
"I suppose you could say we are preparing to help defend the company from a takeover in the future."
Lambert resists the term "shareholder activist".
"We are not activists," he says.
"We are just a group of interested shareholders who are big believers in lithium and electric vehicles."
Brinsden met with Lambert recently in Perth. At the meeting Lambert suggested he interview Brinsden and the transcript be released to the ASX.
Within a couple of weeks, Brinsden had done an interview with the company Inside Briefing and released it to the ASX. Not everyone happy on HotCopper
The like-minded shareholders in Pilbara Minerals all met on the HotCopper stock market forum. It has about 250,000 registered users and records about 8000 posts a day.
Not everyone on HotCopper is happy with the activism by OzBlue and SuperNinja.
A poster called Fiveyearplan this week attacked both OzBlue and SuperNinja for "spewing forth all manner of misguided suggestions of what they (Pilbara Minerals) should be doing".
"Superninja, I enjoyed your earlier posts, but more recently as your employment proposal to management appears to have been rebuffed, you are behaving like a jilted lover," Fiveyearplan said.
"Ozblue, your posts are also becoming overly zealous and demanding and I hope your status as chief Poobah of retail shareholders group doesn't get out of hand.
"Not all management's moves may have been 100% right with the benefit of hindsight, but so far on the past two years performance they get the overall big tick - and the best is yet to come.
"Obviously, as major shareholders in PLS, their interests are aligned with ours, so all the HotCopper self-appointed management-in-waiting lithium guru's need to get off their backs with your minor gripes, and stop pretending you could all be doing so much better.
"This company is in good hands.
"So, best let them get on with it."
Langford replied that nobody had told management what to do and his email outlining a public relations role at Pilbara Minerals was simply following a suggestion from OzBlue.
Lambert responded with: "I just spend many, many hours everyday working on trying to get the best result for ALL shareholders."
(20min delay)