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No legal basis for Magnus Energy to challenge EGM resolutions: requisitioning shareholders

THE four requisitioning shareholders of Magnus Energy Group said they will not be responding to the company’s arguments relating to an upcoming extraordinary general meeting (EGM).

In a letter dated Dec 5, the requisitioning shareholders – who are calling for an EGM to remove and appoint directors – claimed that Magnus had no legal basis to challenge the wordings of any proposed resolution for the meeting.

They were referring to a Dec 4 letter sent by Magnus to the requisitioning shareholders, in which the company had said that the first resolution, to remove Seet Chor Hoon as an independent director, was “defective”.

The proposed resolution to remove Ms Seet, one of the two remaining directors, is a “usurpation of the powers of the directors”, and cannot be validly passed by shareholders at an EGM, Magnus wrote in its letter.

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Magnus also said that the sixth resolution, to remove any directors appointed between the date of the requisition notice and the EGM date, was redundant.

In response, the requisitioning shareholders wrote that Magnus’ arguments were “baseless” and thus there is no reason to respond to them.

Magnus said on Thursday that it is seeking legal advice on the matter and will update shareholders accordingly.

The company has also instructed its lawyers, Chris Chong & CT Ho LLP, to proceed with the preparation of the shareholders’ circular and seek its sponsor’s clearance of the circular by Dec 13.

Magnus will then send out the notice of EGM and the circular to shareholders by Dec 20, and the EGM will be held between Jan 17 and Jan 21, 2020, as it had announced on Wednesday.

Magnus shares have been suspended from trading since Aug 23.