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(Alliance News) - Gem Diamonds Ltd shareholders revolted against the disapplication of pre-emption rights at Wednesday's annual general meeting.
The resolutions - to waive shareholders' rights of pre emption and to waive shareholders' rights of pre emption in connection with an acquisition or specified capital investment - were not passed by shareholders.
The vote amounted to 31% against and 69% for.
"The board is disappointed in this outcome given that each of the resolutions followed the provisions of the pre-emption group's statement of principles for the disapplication of pre-emption rights and reflect UK listed company market practice," Gem Diamonds said.
The company said the vote suffered primarily as a result of votes cast by an unnamed "significant shareholder".
Gem continued: "The board considers the flexibility afforded by these authorities to be in the best interests of the company and shareholders and notes that they have received support at past AGMs.
"However, the board is aware that certain shareholders have a policy of not supporting such resolutions and notes the votes also received against Resolution 14 (authority to allot shares)."
The same number of shareholders - 31% - were against resolution 14 as against resolutions 15 and 16.
"The board remains committed to continuing an open and transparent dialogue and will accordingly, seek to continue to engage with those shareholders regarding their views in this area," Gem added.
Shares in Gem Diamonds closed 3.9% lower in London on Wednesday at 29.80 pence each.
By Paul McGowan; paulmcgowan@alliancenews.com
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