Oxiana votes against payment to HegartyOxiana Ltd shareholders...

Oxiana votes against payment to Hegarty

Oxiana Ltd shareholders have voted against a $10.6 million termination payment to former managing director Owen Hegarty, following the company's $4.2 billion merger with Zinifex Ltd.

About 56 per cent of proxies were cast against the proposed payment to Mr Hegarty, who has stepped down to take a seat on the board of directors of the merged group.

Zinifex boss Andrew Michelmore will become chief executive role of the new entity.

The new company, named OZ Minerals Ltd, will be the world's second largest zinc producer and have significant exposure to copper, lead, gold, silver and nickel.

OZ Minerals Ltd has provided a bullish outlook for its core commodities but attempted to distance itself from the zinc company tag amid sinking prices for the commodity.

"Some commentators say that OZ Minerals is a zinc company. Well, it's not," chairman Barry Cusack told a meeting of shareholders in Melbourne on Friday.

"Copper is a core commodity for OZ Minerals ... (and) will contribute more of our revenue than zinc once Prominent Hill comes on stream at the end of year, significantly more."

The $1 billion Prominent Hill project in South Australia will start first production later this year and ramp up to a rate of 100,000 tonnes of copper and 80,000 ounces of gold a year.

Falling zinc prices have brought a halt to the development of AIM Resources Ltd's Perkoa mine in Africa and brought about the premature closure of the Xstrata and Teck Cominco's Lennard Shelf operation in Western Australia.

The falling zinc price also contributed to the breakdown of merger plans between junior miners Perilya Ltd and CBH Resources Ltd.

Mr Cusack said the drop in the zinc price was "inconsistent with underlying demand" and the outlook for the metal was "strong", with most analysts estimating the commodity would be in deficit by 2010 to 2011.

OZ Minerals chief executive Andrew Michelmore painted a bullish outlook for copper and gold and said zinc would remain "a key part of the commodity mix".

Mr Michelmore, the former Zinifex boss, said the merged company would pursue aggressively "large-scale opportunities" in the resources sector to further diversify its operations.