Good morning,
As you are aware, on July 19 I commenced a formal campaign to Change management at TNG.
In the five weeks since I have been privileged to get know the shareholders of TNG, both small and large, and both here in Australia and overseas.
These shareholders want the best for the company that they own. And they have been voting early and for Change.
State of play
As regards the state of play, after the first ten days of voting, I can confirm that the Change campaign is on track to prevail decisively. I expect all five Resolutions to be passed with overwhelming majorities.
While there have been requests that I publish the independent count, or even a projected result, I refer shareholders to Update 20. Specifically, there are strict legal considerations regarding the dissemination of confidential and market information. Ongoing compliance with the collective action regime is an additional consideration.
I can however describe the basis for my expectation, as follows:
- Early votes that the Change campaign has confirmed via emails which shareholders have independently and voluntarily sent to change@tng249.com.au, along with direct communications with large shareholders based in Australia;
- Constructive and open dialogues with major offshore shareholders;
- The use of statistical and game theoretical disciplines to project the early vote forward.
Regarding major offshore shareholders, my commentary remains the same: out of abundance of caution regarding the collective action regime, along with commercial sensitivities, I will not be claiming support in public.
Regarding the independent count maintained by the Change campaign, I confirm that it is running far ahead of 249D campaign run by Mr Paul Brown (a requisitioning member) in 2018.
I have included as an attachment the results from that campaign, and highlight that:
- 961,070,801 shares were on issue at the time. This compares to 1,388,418,222 shares on issue at present.
- In terms of the poll results, 287,818,198 votes were cast for; 290,485,924 votes were cast against; 259,588 votes abstained.
- This provided a participation rate of 60.2%, and a margin of 49.8%/50.2%.
I further confirm that the prior campaign affords a strong baseline to project the early vote for Change forward using granular registry data and a variety of statistical techniques.
Regarding game theoretical techniques, the key concept here is known as a Nash equilibrium. This is relevant in multi-player non-cooperative decision frameworks, such as a 249D action. The main insight is that each player, or voter in this instance, knows the equilibrium strategy of others, and thereby has nothing to gain from changing their own strategy.
Translating this to ordinary English, it means that preference for Change will, in practically all circumstances, and for small and large shareholders, stay that way.
Further regarding the outcome, I confirm an intention to release to Shareholders the margin of the vote registered with Computershare in the event that the relevant Directors resign before the General Meeting and I am appointed.
Closure of window for negotiated outcome
Given the state of play, I confirm that the campaign for Change is now entering its next phase.
Over the past five weeks I have taken extensive steps, both privately and publicly, to encourage management to engage with legal representation to facilitate the transition that is so clearly in the best interests of TNG.
They have refused in all instances to meet on the basis proposed.
Meanwhile, their recent conduct has further illustrated the inadequacies of governance that were central to the Members’ Statement provided to management on July 20.
The crisis of governance is real, and it has now engulfed management at TNG.
Specifically, I confirm that the appointment of a London-based Non Executive Director (see Update 7) and, especially, last week’s announcement regarding Lithium exploration tenement packages (see Update 23), has provoked deep unease amongst shareholders, both small and large, and both in Australia and overseas.
This is not to mention the various disingenuous and misleading contentions included in the Notice of Meeting, that I responded to in Update 17.
In these circumstances I confirm that:
- The window for a negotiated settlement with management will be withdrawn at close of business this Wednesday, 24 August.
- After this time, the choice will be to publicly resign, or to protract the transition process all the way to the General Meeting on September 20.
Use of Company funds
Regarding the use of Company funds through the campaign, the key principle is that such expenditures must be reasonable. This is an overarching principle, and includes the cost of mailouts and call centres, that were discussed extensively online last week.
In contrast to management’s use of company funds, I continue to finance the Change campaign personally, inclusive of legal, IT and roadshow events. The cumulative cost is now in excess of $150,000.
I reiterate that I will not be expensing any of these costs to the company upon the change of control. I continue to view the Change campaign as necessary for TNG, and my financial contribution as a form of public service.
The Change team is fully prepared
As we enter this next phase I trust that all Shareholders will recognise that I have done everything I can do to facilitate an orderly transition at TNG.
Shareholders can also be assured that Dr Anthony Robinson and myself are fully prepared for a change in control, and looking forward for the new era to commence.
I will be making a further announcement on Thursday, in the event that management does not take up the final opportunity to negotiate an orderly exit.
Onward,
Grant.
Proposed Chair of TNG Limited