Oakbay warned over JSE listing

The JSE has notified Oakbay Resources that it is considering suspending trading in the company’s shares following a recent spate of critical resignations.

In a Sens announcement on Thursday, Oakbay said it was considering various alternatives and advised shareholders to exercise caution when dealing in the company’s shares.

In the past four weeks, Oakbay’s sponsor and transfer secretary have tendered their resignations. In addition, on May 12 independent nonexecutive director Mark Pamensky said he was retiring with effect from June 10. He was the chairman of Oakbay’s audit committee and a member of the company’s risk, nomination, remuneration and social and ethics committees. At the time, Oakbay said it had begun the process of appointing a replacement for Pamensky.

On June 5, the company announced that its sponsor, River Group, had given notice that it would terminate its service after July 31. “The reason for River Group’s termination of their services is due to their revised assessment of association risk surrounding the company and its shareholders,” said Oakbay. On June 13, the firm’s transfer secretary gave notice that it was also terminating its services no earlier than July 31.

The critical resignations mean that Oakbay is at risk of contravening a number of the JSE listings’ requirements.

Oakbay said if it cannot find a replacement for Pamensky, it might not be able to constitute a functioning audit committee, which is considered the most critical of board committees. Oakbay also said Pamensky’s resignation may have compromised the composition of the social, ethics and remuneration committee, which are requirements of the Companies Act.

The sponsor and transfer secretary were mandatory appointments for JSE-listed firms and, said Oakbay, played a critical part in the JSE’s regulatory and supervisory structure.