LONDON (Reuters) - A leading adviser on Wednesday lent its weight to calls from dissident shareholders to remove Peter Hambro from the board of London-listed Petropavlovsk (POG.L), the Russian-focused gold miner he founded in 1994.
Dissident shareholders together holding an almost 40 percent stake have backed nominees to replace four out of six directors at Petropavlovsk, including Hambro.
In an initial report, shareholder advisor ISS advised against supporting any of the dissident proposals, but on Wednesday it issued revised recommendations, saying it had received additional information.
“While the dissidents have not provided a detailed strategy and transition plan, we recognise that they have made a compelling case that change at the board level is warranted,” it said, recommending a vote against Hambro’s re-election.
Hambro, who agreed earlier this year to stand down as chairman and instead be an executive director, told Reuters the allegations of inadequate governance were “very subjective” and he would continue talking to the shareholders and ISS.
“We believe that we have good corporate governance,” he said.
ISS recommended backing two of the dissidents’ nominees. They are Garrett Soden, who has worked for the Lundin group of companies for a decade, and Ian Ashby, nominated to be chairman.
ISS recommended rejecting two other nominees - Bruce Buck, who is chairman of Chelsea Football Club, and Vladislav Egorov, who works for Renova, Russian billionaire Viktor Vekselberg’s conglomerate.
Chelsea Football Club has declined to comment, as has Renova -- Petropavlovk’s biggest shareholder with 14.6 percent.
Other shareholders DE Shaw, M&G and Sothic, which together hold 25 percent, said in a statement on Wednesday they had no intention of taking control of the company and were not acting with Renova.
“Petropavlovsk needs a board with strong, independent directors who can support and constructively challenge management on operational, financial and strategic issues in order to return value to shareholders,” they said.
It added M&G had submitted at least 10 independent candidates to Petropavlovsk’s nomination committee since 2015, but all had been dismissed.
In the years before a restructuring in 2015, Petropavlovsk’s equity value collapsed.
The share price has recovered from lows around 2 pence at the end of 2014 to just over 8 pence, boosted by a return to profit in 2016, but the dissidents say it is still underperforming its peers.
Additional reporting by Polina Devitt in Moscow; Editing by Adrian Croft