Paulson & Co.’s effort to replace most of Detour Gold Corp.’s board was dealt a blow after a prominent shareholder advisory firm urged investors to side with the company’s plans to appoint just two of the activist’s eight nominees.
Institutional Shareholder Services Inc. said while Paulson had made a case that change was warranted at the Toronto miner, Detour had been responsive to its concerns by appointing three new directors in August and offering to appoint two of the dissident’s nominees to its board.
“Despite seeking to replace all but one of the incumbent nominees, the dissident has not articulated a sufficiently detailed go-forward plan,” ISS said in its report issued late Friday.
The advisory firm did say that due to the company’s prolonged under performance, investors may want to instill “the board with an even greater sense of urgency and perhaps speed up the CEO search.” It recommended investors consider supporting an additional dissident nominee, such as Dawn Whittaker, in that case, in addition to Steven Feldman and Christopher Robison, who are supported by both the company and Paulson.
Alex Morrison, Detour’s chairman, said he was pleased ISS had joined a number of shareholders in recognizing the changes the company had made and the role interim Chief Executive Officer Michael Kenyon will have in overseeing the company’s plans and the selection of his successor.