Bowleven: Crown Ocean Resolutions Prevail
Edison | Mar 15, 2017 09:20AM ET
The results of the Bowleven (OTC:BWLVF) general meeting (GM) were released this morning, with eight of the nine resolutions passed. This has led to the removal as directors of all but two of the board: the chairman Billy Allan and COO David Clarkson. They are joined by two additions proposed by Crown Ocean Capital: Eli Chahin and Christopher Ashworth. The results of the votes were all close run, with between 49.4% and 54.8% voting for. Given this, and the split board, we are unsure as to the near-term future for the company’s strategy. We would expect the new board to meet as a matter of urgency to look to resolve this uncertainty.
All but one of the resolutions were passed on slim margins, resulting in the removal of all affected directors and the election of two new additions. Billy Allan survived the vote and will remain chairman of the four-member board (with a casting vote).
If the board now follows through on the direction set by Crown Ocean, we would expect a focus on costs in the near term and a strategy to monetise/exit Bomono. It is not clear what will happen with the Bomono asset, where the farm-out with VOG (announced on 6 March) could be terminated by VOG following the vote. This would leave the company’s notable cash position able to be deployed exclusively for Etinde development, with any excess returned to shareholders. At this point, given the significant uncertainty over the development options at Etinde and the resulting costs, it is not clear how this possible cash return will be calculated.
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