CNOOC INEDs not unanimous
30 December 2005
In a bizarre development following our criticism of the independent non-executive directors (INEDs) of CNOOC Ltd (CNOOC, 0883) for approving and recommending shareholders to vote in favour of relaxing the parent company's non-compete undertakings, CNOOC has announced that one of the independent directors, whose recommendation was contained in the circular, didn't even attend the meeting to sign off on the deal. That's his name right up there in the head of the 5-man signature block.
CNOOC now says that although Goldman Sachs Asia Vice Chairman Ken Courtis "participated" in the "process", "due to a conflicting travel schedule he was prevented from attending the last Independent Board Committee meeting."
How many meetings were there, we wonder? Did he attend all the others? Will we see him, or any of the other INEDs, at the EGM tomorrow (Saturday)? If not, we can only conclude that they did not have sufficient notice of the EGM to re-arrange their schedules - something which could be said for most shareholders of CNOOC too.
In the light of the announcement, it's worth noting that when we inspected the documents on display at the company's lawyers Herbert Smith on 17-Dec-05, the only manual signature on the letter of recommendation from the Independent Board Committee, which had been faxed, was the signature of Mr Sung Hong Chiu. Surely all the INEDs present at the meeting should have signed it.
Shareholders have been misled by the circular's unanimous recommendation, which clearly is now not unanimous. The meeting should be adjourned to give shareholders time to consider Mr Courtis' point of view, assuming he has one, and if not, to consider his abstention from the recommendation. Otherwise, investors have voted on the basis of a false and misleading circular.
Mr Courtis is obviously trying to distance himself from the proposal, otherwise, notwithstanding his absence from the "last" meeting, since he had "participated in the process" he would have confirmed in this announcement his agreement with the recommendation of the IBC. He did not.
© Webb-site.com, 2005
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