NAPLES, Apr 08, 2020 (GLOBE NEWSWIRE via COMTEX) -- Pentwater Capital Management LP ("Pentwater"), a long-term supportive investor and the largest minority shareholder of Turquoise Hill Resources Ltd. ("Turquoise Hill" or the "Company") /zigman2/quotes/209933612/delayed CA:TRQ 0.00% /zigman2/quotes/208953645/composite TRQ -0.04% , owning, together with its affiliates and associates, approximately 9.09% of the Company's issued and outstanding common shares, today responded to Turquoise Hill's April 6, 2020 press release.
Pentwater believes that Turquoise Hill's release not only fails adequately to address the important concerns voiced in Pentwater's recently filed proxy circular, but is both misleading and inaccurate in its attempt to deflect accountability for the self-inflicted wounds that have been an overhang on the Company's otherwise world-class asset base away from the Company's management team and board of directors (the "Board").
A fundamental problem here is that Rio Tinto plc. /zigman2/quotes/202627887/composite RIO +2.69% (lon:RIO)(asx:RIO) ("Rio" or "Rio Tinto") controls the nomination and election of the entire Board. The directors serve at Rio's discretion and at the same time they are responsible for overseeing multi-billion dollar transactions between Rio and Turquoise Hill. Pentwater seeks minority shareholder support in demanding effective minority shareholder representation on the Board, which is imperative to achieve appropriate oversight of the varied and conflicted financial transactions between Rio and Turquoise Hill.
Turquoise Hill's press release states that its, "management and Board have the requisite experience and judgment to oversee the successful development of this world-class asset." The facts tell a different story.
Also in its press release, Turquoise Hill states that it, "has retained independent third party experts to review cost and schedule reporting." Who are these supposed "experts" and what did they say?
Turquoise Hill states that The Board "has a strong record of refreshment," exemplified by the addition of two independent directors in the past three years. "Refreshment" is an odd word for surprise resignations.
Finally, Turquoise Hill states that the Board has implemented "a long-term TRQ stock-based incentive plan to align executives' interests with those of all shareholders." The Board's is aligned with Rio, period.
-- This statement belies reality. When the entirety of the executive team and the Board of Directors collectively own common shares worth less Cdn$151,000 based on current trading prices, the only shareholder with whom their interests are aligned is the majority shareholder that hired them and can at any moment fire them, Rio Tinto. Aside from the CEO, the largest holding by any member of the executive team or Board is the 30,000 shares held by the Board Chair Peter Gillin which are worth Cdn$18,600 based on current trading prices. To be clear, he owns Cdn$18,600 worth of shares after eight years of serving as an independent director.
Pentwater does not take lightly the idea of criticizing the management and corporate governance of any company in which it owns a significant equity stake. But Pentwater believes that a world-class asset deserves a world class Board that represents the interests of all shareholders, and not just the interests of its controller, Rio Tinto. Pentwater believes that the right changes, if enacted swiftly at the upcoming shareholder meeting, will redound to the benefit of Turquoise Hill and its shareholders.
We Need Your Support
We are seeking your support at the Company's upcoming annual and special meeting of shareholders to be held on May 12, 2020 to restore accountability at Turquoise Hill, and give minority shareholders back their voice.
We encourage our fellow shareholders to consider the facts and take action against the current culture of entrenchment, value destruction and misconduct at Turquoise Hill. The interests of the Company's minority shareholders have been disregarded for far too long. Your vote is critical to initiate much-needed change, to restore accountability and to safeguard minority shareholder interests in Turquoise Hill.
Shareholders are urged to vote only the GOLD proxy:
-- FOR the election of Matthew Halbower to the board of directors of the Company;
-- WITHHOLD in respect of the election of all of the management nominees to the board of directors of the Company; and
-- FOR the adoption of the shareholder proposal submitted by Pentwater to amend the Company's articles to provide minority shareholders of the Company with the exclusive right to nominate and elect three of seven directors to the Board.
Shareholders are urged to read the full text of Pentwater's proxy circular, related press releases and the April 3, 2019 Letter to the Turquoise Hill Board, which are being filed and made available under Turquoise Hill's issuer profile at www.sedar.com .
For further information contact:
MacKenzie Partners, Inc.
Daniel Burch - 1-212-929-5748
Jeanne Carr - 1-917-648-4478
Pentwater is a private investment firm focused on investing in event driven strategies with expertise across the capital structure. Founded in April of 2007, the firm's experienced team uses a dynamic, disciplined approach to mitigate risk and optimize returns.
The head office of Pentwater is located at 1001 10th Ave South, Suite 216, Naples, FL 34102.
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