The interim chief executive officer of Detour Gold Corp. is firing back at dissident shareholder Paulson & Co. and insisting that remaining as a standalone, and not selling the company, is in the best interests of shareholders.
“[A sale] may benefit Mr. Paulson, but the shareholders I talked to aren’t interested,“ Michael Kenyon said in an interview. “We have lots of shareholders. The ones I talk to are interested in the life of mine execution. They see the value in developing a 16-million-ounce resource.”
Mr. Kenyon said he’s spoken to most of the company’s top shareholders and the “vast majority” are supportive of the plan to forge ahead with a costly expansion of its flagship mine in Northern Ontario.
In April, shares in the company plunged 30 per cent in a single session, after it announced the expansion of its Detour Lake gold mine would entail materially higher costs than expected. Detour also revealed it is having trouble securing mine permits after failing to get approval from a First Nations stakeholder. Last month, New York-based Paulson & Co., which owns 5.5 per cent of the shares, pleaded with Detour to sell itself, after years of underperformance.
Last month, Marcelo Kim, partner with Paulson & Co., told The Globe and Mail that a failure to initiate an official sales process is an indication of an “entrenched board looking out for its own interests, and not those of its shareholders.”
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