The battle between Gulf Keystone and investors M&G has stepped up a gear after the oil group recommended shareholders reject all of the latter’s boardroom nominees.
Meanwhile M&G, which has criticised corporate governance and levels of executive pay at Gulf Keystone, is now preparing to vote against approving new chairman Simon Murray, according to reports last night.
Keystone said in an update to shareholders ahead of next week’s annual general meeting that it had interviewed three of the four nominees by M&G – Philip Dimmock, John Bell and Thomas Shull. Representatives were unable to interview the fourth nominee – its own former deputy chairman Jeremy Asher.
However, in a strongly worded letter to shareholders, they warned that Asher “has previously been a disruptive presence” on the Gulf Keystone board prior to his removal in March 2010.
Lord Guthrie of Cragiebank, who heads the nominations committee, claimed Asher had also written to the authorities in Kurdistan – where Keystone’s prize oil asset is – seeking a meeting over the board’s composition, which the Kurdish authorities had refused to agree to.
Meanwhile the three other candidates did not have “the consistent track record of successful operational and commercial experience, in any sector, that is required for a FTSE 250-sized company”, it said in the letter to shareholders.
Instead, the company said, Gulf Keystone said the Board was confident of attracting candidates of a high calibre instead of the M&G candidates, adding that first interviews with three outstanding candidates had taken place during the week.
The battle between the two companies has escalated since former French Foreign Legion soldier and Glencore chairman Simon Murray was brought on board as chairman ahead of the company’s planned move from the AIM to the main stock exchange.
Gulf Keystone was last month given approval for its flagship Shaikan field in Kurdistan, but has found itself up against M&G, which holds a 5.1% stake in the company.
“M&G is not seeking representation on the board of GKP, nor has any wish to interfere with its operations,” the investors said in a statement.
“We do want the election of truly independent non-executive directors who will represent the interests of all shareholders. We are not asking for any special relationship with the four candidates: our aim is purely to strengthen corporate governance at GKP.”
M&G is set to vote against the re-appointment of two existing directors, but reports last night suggested it may also vote against Murray’s appointment following the weekend row.
Shareholders will have the opportunity to decide on the new directors on July 25.