Gunson is in a critical position right now. No money, no cred in the market, no exploration up-side at the moment, and a leadership stalemate.
The strategic review has come and gone, with the results (at least, those findings that were summarised and filtered and relayed to us poor shareholders) being bland, unimaginative, and could have been written by a novice. So much for all the bucks thrown at Azure Capital – a disappointing report, seemingly prepared by a junior and signed off in a hurry. Money for old rope for them.
Hey, the terms of reference stated that shareholders and other stakeholders were to be consulted. Where is the part of their report that deals with this? It seems no shareholder who posts on Hot Copper was consulted, else presumably they would have posted to that effect. We all must be non-important shareholders. Fair enough, but in any case, the report should have included the results of shareholder consultation, and that part of the report should have been made public by Gunson. Or if no consultation occurred, then it should have been stated and with reasons why.
The terms of reference also required the consultants to: “review other projects held by the Company together with its future exploration strategy and focus...” In my view, this was an essential part of the review. For example, one option for the company would seem to become a cashed up explorer and target with vigour the exploration assets we already have (Fowlers Bay, Mt. Gunson, Northern Territory) and to possibly acquire more. Also, this term of reference for the review would have included the opportunity to analyse MG 14 and the Windabout copper/cobalt at Mt. Gunson and the potential therein for some immediate funds and cash flow.
Yet this term of reference was not addressed by the consultants. We were told by the Board that: “ The Azure Review did not address the Company’s other projects due to the short time available.”
HELLO....they didn’t have time? Here we are, in dire straits, money running out, and in urgent need of a new strategy and direction, encompassing the WHOLE company - and the consultants didn’t have time to do it? What a terrible and sad joke. The Board should be insisting on this, as part of charting a new way forward. This is what Azure Capital or any consultants should be good at – bringing in new ideas, across the whole company as required by the terms of reference. Not to mention, did we get a discount for this portion that wasn’t done, LOL?
A lazy report, not worth anything in my view, no strategic vision or new ideas, delinquent in even addressing all of the terms of reference - and obviously the market has viewed it similarly. Well, to be fair, the review may have been brilliant and full of great ideas and expert analysis, and confidential information about new partners for Coburn etc., but since this has not been made available to us, I can only assess it on that limited part that was passed on to us.
When I first read the company’s announcement dealing with the leadership succession, I thought that Mr. Tilbrook should probably call off the meeting and wait for the succession. But on reading the bland report as passed to us, I am now convinced that action is needed now. Our company is evidently facing some short-term liquidity problems. So, how do we hang on and meander for yet another 12 months while the leadership succession takes place, if we are desperately short of money? Whereas, Mr. Tilbrook’s plan would no doubt see an injection of cash immediately, as well as giving some confidence to the market that something is happening right now before the company loses more money.
Of course, it doesn’t have to be Mr. Tilbrook providing some confidence. It could come from the current Board of Directors providing some new certainty and exciting strategy, such that Mr. Harley can stay on. The review was the chance for them to do this, but sadly, the review (or at least the filtered part we have been privileged as shareholders to see) does not provide this. So, in the next few weeks, we need something from the Board to put some meat on the bones of the review. If not, I can’t see how we can do anything but vote for Mr. Tilbrook.
A circuit breaker is needed, and it’s needed now - we can’t wait till some time in 2014
Just to remind you, and so you can see what we missed out on re future exploration strategy, here are the terms of reference for the strategic review:
In the context of the Company’s current position, the Board has initiated a Strategic Review of the Company which will include a review of the following: • alternatives for maximising the value of the Project, including new avenues or structures for developing the Project or its possible sale; • the future structure of the Company, including a review of the size and composition of both the Board and the executive management team, as well as the possible introduction of a strategic shareholder; • other projects held by the Company together with its future exploration strategy and focus of the Company.. To assist the Company in undertaking this Strategic Review, the Board will be engaging Perth based corporate advisory firm Azure Capital, whose mandate will include consultation with the Company’s major shareholders and important stakeholders. The Strategic Review is scheduled to commence shortly after Easter and a report on recommendations from the Review will be announced at the end of April 2013.
GUN Price at posting:
3.2¢ Sentiment: Hold Disclosure: Held
