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Polo Resources Limited
Craigmuir Chambers, P O Box 71
Road Town, VG1110
British Virgin Islands
To the Board of Directors:
We are disappointed with Polo’s response to the proposals put forth in our letter dated January 28th, 2019. We write to you again so that the Board and the Company’s shareholders fully understand our viewpoint and the reasons for our concern. We firmly believe the underlying value in Polo is significantly higher than the current share price and that the stubborn adherence to the Board's current investment policy is detrimental to the interests of shareholders as a whole. The market’s lack of faith in the stated investment policy is evidenced by the greater than 70% discount of Polo’s share price to its Net Asset Value (“NAV”) per share. The persistently large discount of Polo’s share price to net asset value precludes shareholders from realizing anything remotely close to its fair value through open-market transactions. The status-quo, which has resulted in significant realized and unrealized losses for past and present shareholders of Polo, is unacceptable. Consequently, we request that the Board:
1. Provide fellow concerned shareholder Nicholas Greenwood with the register of members within five business days. As you are aware, Section 100 of the BVI Business Companies Act grants shareholders a statutory right to inspect and make copies of the register of members. The Company has denied Mr. Greenwood’s request to exercise his statutory right, citing “data privacy” concerns. The right to inspect shareholder lists for the purpose of communicating with shareholders with regards to a proper purpose, being in this case the exercise of shareholder rights in the form of gathering support for a potential requisition of a shareholder meeting, is enshrined in company law. We urge the Board to respect this right.
2. Provide an explanation and/or the remuneration committee minutes regarding the appropriateness of Chairman Michael Tang’s total compensation (including the 2018 share option grant of 20 million shares at a greater than 70% discount to NAV.) We note that Chairman Tang’s consulting fees of ~USD 1 million per year from Polo Resources and its investee company GCM Resources is many multiples above the norm. According to BDO’s AIM Directors Remuneration Report 2018, the median average total salary for CEOs of AIM constituents was approximately GBP 150,000. The QCA Remuneration Committee Guide for Small and Mid-Size Quoted Companies states:
“Companies should communicate their decisions and supporting rationale clearly to shareholders and other stakeholders, most importantly through the report of the remuneration committee chairman. A company will face severe criticism if it rewards failure. Just as important is to ensure that mediocre performance is not rewarded as if it were good performance. It is fair that executives are offered the opportunity for higher levels of remuneration if they prod
Phronimos Urges Polo to Respond to Shareholder Requests and Concerns
March 13, 2019—Subsequent to the publication of Phronimos Capital's (“Phronimos”) letter to the Board of Directors of Polo Resources (“Polo” or the “Company”), on February 13th, we have heard from numerous other Polo shareholders supportive of our cause and, consequently, the concerned shareholder group has grown significantly. We believe there will be broad shareholder support for a substantial cash distribution or share buyback if the proposal to return capital were put to a vote at a requisitioned meeting of the shareholders of Polo. Fellow Polo shareholders supportive of a significant share buyback or distribution are encouraged to contact us at sjohn@phronimoscap.com.
Phronimos transmitted a follow-up letter to the Polo Board of Directors today. The full text of the letter can be found below or at: www.phronimoscap.com/news
One must wonder if Mr Tang is either an idiot or a crook.
1. If an idiot, it would explain why he doesn't grasp the fact that the best way to increase shareholder value when your stock is selling at 28% of NAV is to sell assets and buy back your shares.
2. If a crook, one must speculate whether he is inflating the NAV by overstating the value of questionable illiquid holdings. Or alternatively, if he is using company assets for self serving purposes directly or indirectly to benefit himself at the expense of Polo shareholders.
I am not making any charges. Just speculating. Any other explanations are welcome.
And still no word from Phronimiscos?
Maybe another release from them would be interesting to let us know what contact there has been and what their alleged errors are.. Remember they are speaking on behalf of 14% of shareholders
Quite frustrating company but share price well supported by assets. Over next couple of years Prism could generate large profits. GCM always a maybe but could come good. Hib pet continues to grow and make good profits. Things should improve but a lot more time needed. Not for day traders!
The potentially fake Datuk has suggested that the company is focusing on shareholder value by increasing the share price. That doesn't seem to be working too well as this share has done absolutely nothing for many years other than decline. I think its now time to start asking questions about the potentially fake Datuks ability to lead this company on behalf of his shareholders and exactly what he does to deserve his vast remuneration. Questions that have recently been asked by a large shareholder and instead of answering some of these questions the potentially fake Datuk decides instead to focus efforts on trying to contact the originator to clear up a number of inaccuracies that appear in the article.
Stinks.
It would be a lot more helpful if the various investments of Polo and Mr T were a bit more forthcoming as to how their projects are progressing and as to when they may produce some return to shareholders . just saying , lol .
bakky - yes, a Malaysian lawyer told me that a Datuk title in effect can be bought. And if such a person also is in the in the tittle Tatler list then that combination is a massive dont-even-consider-it red flag as far as investing is concerned.
I read somewhere that you can buy the Datuk thingy anyway.
Mr Tang is also a Datuk, an honorary title bestowed on people with great integrity. Who on earth would hold an AGM in Kuala Lumpur when the company is listed on the London index? Perhaps a man who does not want to be questioned at all by any of his shareholders? Perhaps a man who has no integrity whatsoever? Perhaps a man who is rude rather than polite? A Datuk? I don't think so Tang - Moreover a man who wants to increase his personal wealth and couldn't care less about making a return for his shareholders who seem to be a minor inconvenience for him.
The original letter from phronimoscap to the BoD was dated 28th January and published on 12th February. The letter was submitted on behalf of c14% of the shareholding. If the Board is serious about correcting the alleged inaccuracies in that letter,surely it shouldn’t take more than five weeks to do so
Malayisians generally are a polite people, but Mr Tang seems to be from a different mould. I think the shareholders should be scrutinising his remuneration and also reminding other Directors of their fiduciary duties to all the shareholders
The Company appears to be worth a multiple of its market capitalisation but the lack of any communication to its shareholders raises suspicion about the integrity of its Board
Two weeks now and still can’t make contact?
The shareholders pay the consultancy/directors’ fees and what do we get by way of return? Come on Tang
Has anyone tried contacting Blytheweigh, the. PR advisors to the company- a UK number. Might be illuminating what they may say? I’m traveling so not so easy for me
Courtesy from the Datuk to his shareholders? That will be the day. He has nothing but contempt for us all
So, still unable to make contact after a week?
Please share your thoughts with us Mr Tang. Do you have a PR adviser?
You were quick enough to advise us on the good news from Hibiscus. Are we not entitled to some courtesy?
reaction to the POLO sp.
performance from Hibiscus
Would mr john of phronimoscap advise us on this board what, if any, contact he has had from Tang?
"and work to realise and return value to shareholders through timely and appropriate transactions and specifically the appreciation in the value of the Company's shares rather than by means of distribution as previously approved by shareholders."
And that in a nutshell is why the SP is stagnant and why this company is so unloved. Who on earth would buy here? Good for Phronimos for questioning this Datuk and his actions, but from the RNS, he doesn't believe he is answerable to his shareholders IMO
It will be interesting to see what NAV Tang places on the shares as of 31 December which will have to be verified by the auditors. As the valuation of the investment holdings form the bulk of the Board’s and auditors’ duties at year end, why can’t the annual results not be furnished sooner than in previous years? Is it not easier to value a shareholding closer to the date rather than later. The valuation is at year end on the information available at that time and no consideration should be given to subsequent events. Those can be dealt with a note accompanying the accounts under ‘ events since year end’.
What are they doing to justify their fees ?
Good point. I am less than convinced by the RNS. I invested in Polo as I had made a number of poor decisions re commodity investment and I wanted someone who knew what they were doing to help me out. It turns out that my poor investment choices have not done nearly as badly as Mr Tang's dire record.
Quote from Phronimos: While the decision to return capital initially
rests with the Board, shareholders like clients of Phronimos ultimately have other means to effect the
changes necessary to protect their investments."
I have emailed them to pledge the support of my puny investment in the event of them considering 'other means'.
Mr Tang,
Please make contact through “ sjohn@phronimoscap.com “ or by phone +1 4247617871 and advise us of the outcome
Tang says he is a "LONG TERM supportive and ACTIVIST INVESTOR"
Hahaha! He doesn't even know that he is contradicting himself, the little clever clog he is. A shareholder activist is a person who attempts to gain control of the company and replace management or force a major corporate change.
So what does HE do with our money instead of being an activist? He pays and pays into endless bottomless pits and sits for a decade or more and we never hear anything until the investment is written off. Tang is not an activist, rather instead a total passivist void of any analytical skills.
In fact, Tang doesn't even know how Polo itself describes its activities:
"Investments may be made in companies,
partnerships, joint ventures and all types of
assets including unlisted and listed equities,
securities, commodities, bonds, debt
instruments, royalties, options, warrants,
futures and derivatives."
Couldn't be further from an activist shareholder if he tried.
I'm afraid Tang is just a lightweight chancer who wanted to become a big boy in a small pond by purchasing Polo shares at a ridiculously high price from a clever guy who outsmarted him. Tang paid, I think it was, 40p per share for his investment in Polo so for him the current share price is so pathetically low that he mentally no longer sees Polo shares as an investment but instead as CASINO CHIPS to be gambled on all-or-nothing ventures like coal mining/coal power in Bangladesh and a "victorious" arbitration case in phosphate resources in Tunisia. The rest of the money is sunk into other "projects" and "loans" to even riskier dreams and therefore completely stuck for the foreseeable future. As a little bonus in his casino project, Tang helps himself to travel the world on OUR expense for free, plus getting his fees, costing us shareholders tens and hundreds of thousands of pounds, to these various roulette tables plus annual general meetings in exotic faraway places where no ordinary shareholders can attend without spending up to several thousand pounds in traveling costs, where he awards himself and vote through stock options that could give him practically total control one day if the share price ever rises again.
And now Tang the great Datuk has the blooming cheek to say he will waste company time on contacting "the author in order to clear up a number of inaccuracies that appear in the article."... He should weep in shame instead.
''and work to realise and return value to shareholders through timely and appropriate transactions and specifically the appreciation in the value of the Company's shares rather than by means of distribution as previously approved by shareholders''.
And just when will that happen Tang FFS!!??
Dare l say, watch yesterdays buys-sell?