Calling on Shareholders to voice outrage, page-2

I'm sympathetic to your position but can't agree with your solution.

As a shareholder you are part owner of the company and apart from the AGM you rely on the company management to safeguard your interests. It is clear that the management of PAS were not sufficiently active in managing their financial position as they ended up with a debt of $2.8 billion to the banks while making an operating loss. In my opinion their assets were worth no more than $1 billion and that is generous given the average zinc price over the last few years.

Unfortunately the shareholders ended up with negative equity. On the other hand the banks have their loans secured against assets so they should be first in line. Don't forget that they have lost a lot of money as well. Shareholders on the other hand are taking a risk when they invest in a company.

This position is one that all of us as shareholders need to be aware of. A number of other large resource companies are hanging in the balance at the moment (ANL & WMT) and shareholders should not cry foul if they wake up one morning to find their shareholding is worthless. (I'm not saying it is going to happen only that the companies are in a position where it could happen)

The PAS problem lies with the company management not the banks. It's easy for them to blame low zinc prices and adverse currency transactions now but they are paid to manage the company for the shareholders and should have been sufficiently conservative to ensure that it could not get this bad. They let it go on far too long without taking appropriate corrective action. It's a bit like not having a stop loss when the currency hedging starts to get out of shape. They should have closed it out at a loss before it became impossible to control.

(I bet this post will get a few people hot and bothered)