Notification of Maputo Judgment

RNS Number : 3935S

Pathfinder Minerals Plc

06 November 2013

 



For immediate release: 6 November 2013

Pathfinder Minerals Plc
("Pathfinder" or the "Company")

Notification of Maputo Judgment

The Board of Pathfinder announces that it has today been notified of a judgment (the "Judgment") of the First Commercial Section of the Judicial Court of the City of Maputo (the "Maputo Court") made on 21 October 2013 in respect of a claim brought by General Jacinto Veloso, Diogo Cavaco and others (together, the "Claimants") against Companhia Mineira de Naburi SARL ("CMDN"). 

As previously announced, on 17 January 2012 the Company's subsidiary, IM Minerals Limited ("IMM"), in its capacity as 99.99% shareholder of CMDN, convened a general meeting of CMDN for the purpose, amongst other things, of removing General Veloso, his daughter and Diogo Cavaco from the board of CMDN.  The Claimants then brought an application to annul the resolutions which were passed at that general meeting (the "January Resolutions").  The Claimants also appear to have sought a declaration that the nominative share certificate issued by CMDN to IMM evidencing IMM's ownership of 399,998 shares in CMDN (which was signed by General Veloso and Diogo Cavcao) is invalid.

IMM was not a party to the proceedings which have resulted in the Judgment and therefore was not heard by the Maputo Court.  Moreover, as the Judgment expressly records, CMDN did not provide any opposition to the submissions made by the Claimants and, since there was no opposition from CMDN, the facts presented by the Claimants were simply accepted by the Court.  In the absence of any opposition, and without hearing from IMM, the Maputo Court has declared that the January Resolutions are void. 

The Judgment also includes a declaration that IMM's nominative share certificate evidencing its shareholding in CMDN is void, on the basis that the share capital of CMDN is represented by bearer shares.  IMM is advised that that declaration is not legally effective against IMM since IMM was not a party to the proceedings. Pathfinder also notes that this declaration is contrary to the provisional finding of the Maputo Court in a judgment notified on 25 October 2012 that the nominative share certificate evidencing IMM's ownership of 399,998 shares in CMDN is valid and that IMM is, accordingly, the holder of 99.99% of the shares in CMDN.  That judgment was given following submissions made by both IMM and General Veloso/Diogo Cavaco (through CMDN).  The court expressly considered the argument made by General Veloso/Diogo Cavaco (through CMDN) that the share capital of CMDN is represented by bearer shares only and found it to be invalid.

Whilst IMM is itself unable to appeal directly against the Judgment as it is not a party to the proceedings, it will seek the assistance of the authorities in Maputo to intervene in the proceedings and seek a review of the decision.

It is also apparent from the Judgment that General Veloso and Diogo Cavaco did not inform the Maputo Court of the existence of the judgment from the English Court, given on 19 October 2012, which upheld the validity of the agreements by which IMM acquired its shares in CMDN.  As previously announced, that judgment was upheld by the English Court of Appeal and steps are currently under way to have that judgment recognised by the Supreme Court of Mozambique.

Also as previously announced, IMM is a party to other proceedings in the Maputo courts in which the validity of its shareholding in CMDN is to be determined and judgments in those proceedings are still awaited.  IMM is advised that the Judgment is of no legal effect in those proceedings, nor is it binding in the recognition proceedings before the Supreme Court of Mozambique.

Nick Trew, Chief Executive Officer, said:  "It is apparent that General Veloso has obtained a judgment in proceedings in which he was effectively both claimant and defendant.  Unsurprisingly, he provided no opposition to his own case and, further, failed to present the full facts to the Mozambique court.  Whilst it is unfortunate that the Maputo Court was asked to rule without hearing from IMM, and without having the full facts presented to it, the Board will continue to pursue those legal processes to which Pathfinder and IMM are a party to enforce Pathfinder's rights."

Enquiries:

Pathfinder Minerals Plc

Nick Trew, Chief Executive

Tel. [phone]

Daniel Stewart & Company Plc

David Hart or James Thomas

Tel: [phone]

Vigo Communications

Ben Simons or Peter Reilly

Tel: [phone]

Notes to Editors:

Pathfinder Minerals Plc is incorporated in England & Wales and is admitted to trading on the AIM market of the London Stock Exchange. 

Companhia Mineira de Naburi S.A.R.L. ("CMDN"), a subsidiary of Pathfinder Minerals, was issued mining concession licences 760C and 4623C on 13 September 2004 and 13 July 2011 respectively, each for a period of twenty-five years. Taken together, these mining concessions cover approximately 32,000 hectares of land on the Indian Ocean coast of the Zambezia province of Mozambique, known to contain the heavy minerals, ilmenite, rutile and zircon.

As announced on 3 February 2012, ownership of these licences is being disputed.

 

END

 

 

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